HRC price flattens in Europe amid sluggish buying; sentiment still positive

Trading remained sluggish in the European markets for steel hot-rolled coil, with buyers assessing the situation following sharp price rises earlier this week, sources told Fastmarkets on Friday January 12.

Earlier this week, key integrated steelmakers in Northern Europe issued new offers for April-delivery HRC at €800 ($878) per tonne ex-works.

These new offers, however, were far above buyers’ tradeable values estimated of €720-750 per tonne ex-works.

Some buyer sources suggested that €700 per tonne ex-works was still a “reasonable” price for HRC in the region, given the lack of end-user demand.

“Mills are relaxed due to having full order books, but buyers are not in a rush either,” a steel service center in Germany said. “The market has been very quiet recently, and the lack of consumption certainly remains a trigger factor.”

Market sources said that limited supply and restocking were likely to support price rises in the domestic market in January, but “not as high as €800 per tonne ex-works,” they said.

Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe at €731.88 ($802.84) per tonne on January 12, up by €0.63 per tonne compared with €731.25 per tonne on Thursday January 11.

The index was also up by €36.88 per tonne week on week and by €45.38 per tonne month on month.

In Southern Europe, meanwhile, Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Italy at €721.67 per tonne on January 12, increasing by €1.67 per tonne from €720.00 per tonne on January 11.

The index was up by €32.09 per tonne week on week and by €49.38 per tonne month on month.

On Friday, buyer sources estimated the market price at €700-740 per tonne ex-works and said that tighter supply was likely to continue to support price rises through January.

Firm offers and bids were still rare in the market, however.

Key suppliers indicated target prices of €770-780 per tonne delivered (€755-765 per tonne ex-works) for HRC with March-April lead times.

“Everyone just came back to the market after [new year] holidays,” a buyer source said. “More time is needed to see what the real market level is.”

March-shipment HRC from Asia to Italy was reported to be available at €660-670 per tonne CFR, but few suppliers were active.

Market sources have not yet reported any significant affects from the shipping crisis in the Red Sea.

“Most vessels [carrying HRC] are already past the Suez Canal,” a buyer source said. “Some container ships are currently considering the option to go around the Cape of Good Hope. So far, I can’t see this [shipping crisis] raising import prices much.”

Published by: Julia Bolotova