As a result of Europe’s safeguard quota revision, all Italian welded tube re-rollers are raising their prices to reflect the growing expenses related to hot rolled coil imports, market sources tell Kallanish.
One HRC manufacturer in Italy is increasing pricing by €30/tonne ($32), asking for a base ex-works level of €660/tonne, as present contract rates are very close to actual costs. This is being done despite market uncertainty and slow demand.
A re-roller reports that discounts were effectively decreased by two points last week, or €30/t. The company is further reducing discounts by two points this week. Other tube makers are cutting their discounts by four points with immediate effect. However, the first source says the market is moving up by no more than two points every week, and the source expects a gradual but steady rise.
Italian tube discounts stand at 40 points at the moment, down from 42 at the beginning of June. By the conclusion of this week, the goal is to cut discounts to 38 points. Coil derivative pricing is considered unsustainable. Processed products should cost at least €70/t more than they do now, according to one source.
The EU steel safeguard measure may be extended by two more years, until June 2026, the European Commission announced last month. In order to keep the market stable, it wants to impose a 15% cap per origin over the “other nation” tariff-rate quota for HRC.
As a result, starting on 1 July, European tube makers would see a rise in costs. Two sources suggest that the import duty associated with clearing HRC through customs may hover at €70–80/t, to be paid on 1 July. In reaction to the large cost rise, some are thinking about clearing some material at the start of the fourth quarter.
Natalia Capra France