Majority of EU HRC mills inactive in the market, offer rise likely

Majority of the European steelmakers have withdrawn offers of hot-rolled coil on Aug. 22 and they are expected to return to the market in early September, seeking higher prices.

Only one German steelmaker has been offering HRC at Eur650/mt ex-works Ruhr or delivered Ruhr, depending on the buyers’ location. Other German and Northwest European mills have withdrawn offers from the market or remained inactive.

Some sources said that the big steelmaker has already increased offers by Eur50/mt, but the information has not been widely confirmed in the market. Majority of market participants expect the EU mills to increase prices by at least Eur50/mt and the new target price would be Eur700/mt ex-works Ruhr.

“The mills will increase offers after September holidays,” a German service center source said. “They hope that the seasonal demand recovery would give an impulse that would increase the prices.”

Market participants estimated tradable values at Eur630-650/mt ex-works Ruhr.

Platts assessed domestic prices for hot-rolled coil in Northwest Europe up Eur10/mt on the day at Eur645/mt ex-works Ruhr on Aug. 22.

Buyers, however, have been skeptical about bullish mood of the mills due to largely negative demand outlook for the second half of the year.

“I do not see buyers accepting higher prices, as demand outlook remains rather gloomy,” a trader said.

Platts is part of S&P Global Commodity Insights.

Author Maria Tanatar