Few HRC producers active in Northern Europe, prices stable

European hot-rolled coil prices were largely flat amid continued sluggish demand, with distributors and steel service centers struggling to pass on higher prices to downstream customers, sources told Fastmarkets on Thursday July 6.Only a few suppliers are currently active in the Northern European market, sources said.

One integrated mill in Germany announced force majeure last week, while another integrated mill in the Benelux area reportedly had “a big delay with the blast furnace refurbishment,” according to sources.

Offers for September-delivery HRC were reported at between €680 per tonne EXW and €700 per tonne EXW, while rare transactions were heard at €670-680 per tonne EXW in Germany, sources told Fastmarkets.

Information that a major integrated mill in Europe was aiming for a price rise of €50 per tonne for flat steel has been circulating since the start of the week, but could not be widely confirmed by market participants by the time of publication.

In general, however, they said there is no room for a major price rise in the current market conditions, given the slowness of downstream sales.

“Trading activity has picked up from the low levels seen in June, but only because customers are looking to cover for possible shortages [of HRC] due to [technical] problems at some mills and holiday stoppages,” a steel-service center (SSC) source in the region said.

“There is actually no massive restocking [going on], SSCs and distributors have sufficient stocks [and will] only buy some minor tonnages to cover their urgent needs – that’s all. The [distributors, service centers] are not selling much [HRC] downstream and are struggling to increase the price for end users,” a trading source in Germany said.

Fastmarkets’ daily steel HRC index, domestic, exw Northern Europe was calculated at €681.88 per tonne on Thursday, up by €0.21 per tonne from €681.67 per tonne on Wednesday.

The latest calculation of the Northern European index was up by €9.15 per tonne week on week, but down by €39.16 per tonne month on month.

Fastmarkets calculated its corresponding daily steel HRC index, domestic, exw Italy at €659.00 per tonne on Thursday, up by €1.08 per tonne from €657.92 per tonne the previous day.

The Italian index was up by €10.25 per tonne week on week, but down by €8.50 per tonne month on month.

Italian producers were aiming for €670-700 per tonne EXW for August/September-delivery HRC, while buyer estimates of the tradable level came in at €650-660 per tonne EXW.

A transaction for a small tonnage was reported at €660 per tonne EXW by a buyer source on Thursday.

Trading in Italy was also sluggish, with distributors and service centers trying to pass on price rises to downstream customers.

“Sales are very slow, nobody wants to commit to big volumes,” a trading source in Italy said.

The HRC import market was also quiet. August shipments were sold out, while European buyers were not yet ready to book September-October cargoes (with November-December arrival), sources said.

“None of our customers has booked imports [of HRC] in the past couple of weeks,” a distributor said.

Asian suppliers, meanwhile, were aiming for €610-620 per tonne CFR for September-shipment HRC to Italy. Suppliers from Taiwan, Vietnam and Japan were active in the market during the week, sources said.

Published by: Julia Bolotova