European prices for steel hot-rolled coil edged upward hiher on Tuesday March 17, supported by the increasingly limited availability of imports, which trade sources highlighted as a primary factor behind the pronounced uptrend.
Industry sources, however, expressed concerns that the rise had no support from real steel demand.
“We have seen a gradual flat-steel price increase in Europe since January, entirely driven by trade policies and geopolitical turmoil, while there is no improvement from the consumption side,” a buyer in Germany said.
Nonetheless, apparent buying activity has picked up since late February, with buyers looking to secure HRC volumes because of the rising prices.
Some steel-service centers claimed that they had come back into the market to book material, despite holding sufficient stocks, considering the lack of imports and surging domestic prices.
“Nothing is booming, but we have had more inquiries. Some buyers are getting nervous,” a seller in the region said.
Some integrated steelmakers in northern Europe claimed to be nearly sold out of May-delivery coil and were looking for the next round of price increases for June-delivery HRC.
Offers in Germany were heard at €720 ($828) per tonne ex-works, with May lead times still said to be available.
In the Benelux area, one local supplier was offering May-delivery HRC at €700 per tonne ex-works, looking to increase prices by some €20-25 per tonne for June delivery volumes, Fastmarkets heard.
Industry sources estimated achievable prices for HRC at €700-720 per tonne ex-works on Tuesday, but noted that deals were scarce.
As a result, Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Northern Europe, was calculated at €710.13 per tonne on March 17, up by €4.50 per tonne from €705.63 per tonne on March 16.
The index was up by €5.75 per tonne week on week and by €47.32 per tonne month on month.
In the secondary market, meanwhile, some steel service centers claimed to have achieved €800 per tonne CPT for 4mm S235 grade HR sheet, with one source reporting a deal at €830 per tonne CPT, indicating improved buying activity as well as a need to account for more expensive HRC.
In Italy, meanwhile, Fastmarkets’ daily calculation of its steel hot-rolled coil index, domestic, exw Italy, at €697.50 per tonne on March 17, up by €3.50 per tonne from €694.00 per tonne on March 16.
The index was up by €10.00 per tonne week on week and by €41.30 per tonne month on month.
Italian suppliers were maintaining offers for May delivery coil at a minimum of €700 per tonne ex-works, with buying activity said by market sources to still be limited.
Buyers estimated achievable prices at €690-700 per tonne ex-works on Tuesday.
Meanwhile, new import offers – particularly from Asia – were becoming increasingly scarce in Europe due to logistical complexities and soaring freight rates because of the conflict involving the US, Israel and Iran.
Trade sources told Fastmarkets that Asian suppliers preferred to offer material on an FOB basis to avoid exposure to volatile transport costs. They added that Chinese suppliers were adopting this approach not only for Europe, but also for other export destinations, such as Southeast Asia.
As a result, new deals remained limited, with buyers reluctant to assume the risk of rising freight and insurance costs.
So far, Turkish mills have remained among the few viable import options for European buyers.
Offers of HRC with June lead times from Turkey were heard at €570-580 per tonne CFR to Italy, including anti-dumping duty.
Market sources also reported an offer from an Indian mill at €565-570 per tonne CFR.
Algerian suppliers returned to the market with much higher offers, with two sources reporting HRC offered at $715 per tonne FOB. Freight was estimated around $20 per tonne to Italy. New offers were significantly above the market level, but sector sources said that the Algerian mill was well booked and therefore not rushing for sales.
“[The Algerian producer] has a very small [export HRC] volume left for the second quarter, so [its new offer] is not reflecting market levels,” a buyer source in Europe said. “It is not rushing for sales, it can sell the remaining volumes to whoever pays the most.”
The higher offer level was not widely confirmed at the time of publication. Another market source reported an offer from the same supplier at $630 per tonne FOB, closer to current market expectations.
