The European hot-rolled coil market is currently driven by end-user purchases, such as the automotive and tubemakers, sources told S&P Global Platts Sept. 29.
Market participants said that spot-market buying from distributors has been slow in Europe over the past weeks following the end of an initial restocking phase, but that current demand for mills would be driven by end-users.
“We have not seen not seen huge deals being concluded in September by distribution, they rather bought in August or even before,” said a European mill source.
A Benelux trader confirmed that end-buyers would be particularly active on the market but that overall there is still a lack of deals.
“I don’t see a lot of transactions going on. Now the mills have a lot of orders from the car industry,” said a Benelux trader.
The market is also looking towards China again to see where international steel prices are heading as Chinese export prices have shown some weakness. “Let’s see, China is going on holidays and on October 15, we will see what the Chinese market will do,” the trader added.
Prices in Southern Europe were reported at Eur490/mt EXW S.EU with lead times in January/February but one German supplier was heard to be offering at Eur480/mt delivered Italy for December to secure volumes.
The Southern European daily Platts TSI index increased by Eur3/mt to Eur485.5/mt EXW S.EU based on higher tradable values Sept. 29.
Long lead times for European material, however, remain a turn off for buyers in an uncertain economic environment, particularly for those who do not necessarily need material .
“I think at Eur495-500/mt EXW Ruhr we will reach a peak, and I am cautious to buy at that level, afraid that when material comes in, prices will have gone down already,” said a German stockholder.
“People have enough material, people need to wait if sales are successful for end-users. Will price increases touch the end users? Is the demand really recovering or is it only apparent?” the stockholder said.
The daily Platts TSI index for Northern Europe increased Eur2.50/mt to Eur496/mt EXW Ruhr Sept. 29.
Indian import offers were heard at Eur490-500/mt CIF Antwerp, while one source said that Turkish imports were offered below that level for tubemakers, but, considering the pending anti-dumping investigation, were deemed not attractive.
— Laura Varriale, Amanda Flint
