European HRC producers fail to achieve higher prices amid sluggish demand

European hot-rolled coil producers are struggling to achieve higher prices in deals while slow demand hampers their bullish attempts, Fastmarkets heard on Thursday July 13.

Even though the downtrend in the European HRC market has come to a halt and prices been stabilizing for a couple of weeks now, any attempts to push for an increase in price levels from the mill side have been largely unsuccessful, sources said.

“Demand is too slow [and] unsupportive of any rises. We should be happy prices have stopped falling now,” a trading source in Northern Europe told Fastmarkets.

Integrated mills in the region were heard offering September-October delivery coil at around €680-700 ($757-780) per tonne EXW, with buyers looking to pay no higher than €660-680 per tonne EXW.

Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe, was calculated at €679.75 per tonne on Thursday, down by just €0.25 per tonne from €680.00 per tonne on Wednesday.

The latest calculation of the Northern European index was down by just €2.13 per tonne week on week, and down by €12.25 per tonne month on month.

The post-summer outlook is also quite dull due to persistently slow demand from the end-user side, according to sources.

Sources suggested that mills might start reducing output and taking some capacity offline in the fourth quarter to balance the market and spur at least apparent demand.

“I expect a stable market in the last quarter [of 2023] with flat prices, unless producers start switching off capacity; that might help spur buying a bit, but prices [for HRC are] unlikely to rebound sharply without a demand recover,” a distributor said.

Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Italy, at €655.00 per tonne on Thursday, down by €1.88 per tonne from €656.88 per tonne on Wednesday.
The Italian index was down by €4.00 per tonne week on week, and by €5.00 per tonne month on month.
Demand for HRC in Italy also remained sluggish and most market sources do not expect major changes in conditions until the end of summer.
Local mills were aiming to raise prices to around €670-700 per tonne EXW, but transactions were still reported at €640-660 per tonne EXW maximum.
“Prices for processed HRC are still low. We are fighting for every euro of increase with buyers,” a steel service center source said.

HRC import prices have also stabilized recently, with offers from Asian mills reported at €600-630 per tonne CFR for September-October shipment, while one mill from Vietnam was offering HRC to Southern Europe at slightly lower levels – $645 per tonne (around €590 per tonne) CFR.

Published by: Julia Bolotova