Italian hot rolled coil prices are flattening on-week but values are about to increase in Europe mostly due to low availability. European producers are mulling increases for January delivery and some Italian steelmakers are not quoting.
Several sources believe HRC asking values will increase to €650-660/tonne ($687-698) delivered in Italy, while other European producers are expected to ask for €670/t delivered for January lead times. A clearer idea of price will be achieved by the end of this or next week, Kallanish notes.
In Italy, but also wider Europe, multiple re-rollers and service centres have gone back to purchasing since last week. Over the past ten days, EU producers filled their order books until the end of December. With HRC imports limited due to the exhaustion of the “other countries” fourth-quarter quota, and limited import arrivals expected in the first quarter, European steelmakers will be the main source of supply.
The short availability is forecast to support higher prices in the coming months and Q1 2024. This is also due to the several stoppages underway at some major European steelmakers.
The issue remains low consumption downstream and lower prices for sheet and tube. Service centres are seeing continued weak demand and orders for their products, with sheet now at below €700/t ex-works and margins seeing pressure. Service centres are only now receiving HRC bought weeks ago at €650-660/t base ex-works, while their selling prices are on a declining trend.
Italian domestic HRC contracts were concluded over the past ten days at €590-610/t delivered for December lead times. New January lead time values are seen hiking by €50/t, Kallanish notes.
Natalia Capra France