Hi-end coil material pulls standard products down

A lack of demand from carmakers for coil products typically used for automotive purposes is tracing through to standard products, pulling down prices in that segment as well, market players tell Kallanish.

Just after recovering from the coronavirus shock, carmakers reduced their production last year due to the lack of semiconductor chips. This has been badly aggravated by the Ukraine war and the many supply shortages it has caused. According to an Austrian manager, demand for hot-dip galvanized coil is weak, and he doubts that prices of more than €1,500/t ex-works ($1,634/t) as called by mills earlier have lived long. High availability is one indicator here, with delivery times “that feel like it is only a couple of days until you get it.”

Another Austrian notes that especially high-end galv typically used in cars is low in demand.

“When carmakers need a lot of, for example, organic coated strip, less material is left for standard galv and cold-rolled coil, which keps prices up in that segment, too,“ he says. “We felt a shortage temporarily last year, but not any more now.”

Prices for cold-rolled seem to be more stable than for galv, and in Benelux is seen around or above €1,450/t. In Austria, buyers are more doubtful. They believe that mills have to sell hot-rolled coil definitely for less than the €1,350/t lately called by the market leader, and cold-rolled coil will be hardly €100/t above that.  

According to all observers, inventories are relatively full, and buyers confine themselves to the most necessary, especially after being deterred by the former peak values.

On top of this, a German trader dares people to look at the international price levels, to see why German prices can only go down from where they are: “German prices just don’t fit in the global picture.”

Christian Koehl Germany