European HRC producers increasingly bullish on prices amid rising costs, reduced supplies

European hot-rolled coil prices stabilized on Wednesday November 1, mainly due to a lack of activity amid public holidays across the region, but mills are getting increasingly bullish and are raising their offer prices for January delivery coil, sources told Fastmarkets.

Integrated steelmakers in Northern Europe are aiming for €30-50 ($32-53) per tonne rises for January delivery coil, citing higher costs and limited availability due to production cuts.

Offers for January delivery HRC from the mills in the region were reported at €660-680 ($699-720) per tonne ex-works.

Buyer price ideas for HRC, however, were reported at €620-630 per tonne ex-works.

Even lower bids – at €600-610 per tonne ex-works – were heard for December delivery HRC, but mills were reluctant to accept the lower prices, sources said.

Buyers were coming back to the market for to restock, but remained cautious about making bookings, due to being unconvinced about the sustainability of the price uptrend and citing deteriorating demand from end-user sectors and a poor outlook for 2024.

“Prices are, indeed, moving up a bit, but it’s not because of an improving economy,” a steel service center source told Fastmarkets. “It’s restocking to secure deliveries and confirmed lead times, so as not to run out of material. [But] most mills are reducing production.”

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €622.50 ($659.98) per tonne on November 1, unchanged from Tuesday.

But the index was up by €11.04 per tonne week on week and by €2.08 per tonne month on month.

In Southern Europe, Fastmarkets’ calculated its corresponding daily steel hot-rolled coil index domestic, exw Italy at €603.75 per tonne on November 1, also stable day on day.

The Italian index was up by €3.75 per tonne week on week, but down by €5.00 per tonne month on month.

The market  was quiet on November 1 due to a public holiday in Italy, but sources said there had been a slight pick-up in activity due to some cautious restocking.

For December delivery, Italian mills were looking to get €640-650 per tonne delivered, which nets back to €625-635 per tonne ex-works. But for January tonnages some producers were aiming as high at 650 per tonne ex-works, sources said.

Buyer price ideas came in at about €600-610 per tonne ex-works, or even €600 per tonne delivered in some cases, but producers were not accepting any lower bids, they added.

Import offers were getting scarce, however, with the lowest-cost options reportedly already gone and with some suppliers also mulling prices rises.

In general, prices for Asia-origin HRC for early January shipment were consolidating at around €600 per tonne CFR.

Published by: Julia Bolotova