Prices for downstream flat steel products softened in Europe in the week to Wednesday November 16 amid slow demand and competition with imports, sources have told Fastmarkets.HDG
Market sources said that stock levels of hot-dipped galvanized coil (HDG) among European buyers was generally trending downward and that buyers would normally start bookings for January volumes around this time.
But the buyers would like to wait and see the price at its lowest point before restocking for the first quarter, Fastmarkets understands.
“We would like to book [HDG] when [the price] hits rock-bottom,” a trader in Italy said.
Italian mills have reduced their offer prices recently to spur buying activity, several sources said.
Notably, two distributor sources reported an offer price from one integrated mill in Italy at €750 ($777) per tonne ex-works for base HDG.
Official offers were ranging between €750 per tonne ex-works and €770 per tonne ex-works in the country.
Fastmarkets’ weekly price assessment for steel HDG, domestic, exw Southern Europe, was €750-770 per tonne on November 16, down by €40-50 per tonne from €800-810 per tonne the previous week.
The corresponding weekly price assessment for steel HDG, domestic, exw Northern Europe, was €750-770 per tonne on November 16, down by €40-50 per tonne from €790-820 per tonne seven days earlier.
Market sources said that most buyers still had sufficient stocks of cold-rolled coil and were not seeking tonnages. Weak order intake from the key consumer of the material, the automotive industry, was one of the main reasons for that.
But the European mills could not really be flexible with CRC offers due to their high production costs. Notably, batch annealing – the most common production route for CRC – was very energy-intensive, according to market sources. Official offers of CRC from European producers were consequently rare.
“The European mills are totally out of the game for CRC. They cannot really compete with imports,” a trader in Italy said.
Fastmarkets’ weekly price assessment for steel CRC, domestic, exw Northern Europe, was €750-760 per tonne on Wednesday, narrowing downward by €10 per tonne from €750-770 per tonne seven days earlier.
The assessment was a reflection of offers and buyers’ estimates of achievable prices. Also, bookings of small tonnages of CRC were reported within the range during the assessment week by both buyers and producers.
Fastmarkets’ weekly price assessment for steel cold-rolled coil, domestic, exw Southern Europe, was €750-770 per tonne on Wednesday, down by just €10 per tonne from €760-780 per tonne a week before.
Apart from the weak demand and overstocking, CRC prices in Southern Europe were also under downward pressure from competitive overseas offers, sources said.
Notably, import CRC offers to Italy from Southeast Asia were heard at €655-670 per tonne CFR recently for late-first-quarter delivery material.
Fastmarkets’ price assessment for steel cold-rolled coil, import, cfr main port Southern Europe, was €655-670 per tonne on November 16, down by €30 per tonne from €685-700 per tonne seven days before.
Published by: Julia Bolotova