Negative sentiment intensifies in European HRC market on low demand

The mood in the European spot hot-rolled coil market was strongly negative July 14 due to limited demand and a seasonal activity slowdown.

Offers from integrated Northwest European mills have been limited as some have full order books until October. Scheduled maintenance during summer and healthy demand from the automotive industry supported those solid order books.

Other integrated mills, however, had August rolling coil to offer, indicating limited demand from distributors.

Spot demand has been low as European distributors have held back from bookings due to an uncertain outlook for the second half of 2023, sufficient stock volumes and weak demand from end-users, apart from the auto industry.

Market participants estimated HRC prices from Ruhr-area mills at Eur660-680/mt ex-works Ruhr, and offers from Northwest European mills outside the Ruhr area have been heard at Eur650-660/mt ex-works.

Some market sources believe that the mills, including those in Germany, were ready to give discounts to prices below Eur650/mt ex-works for bigger volumes.

Platts assessed domestic prices for hot-rolled coil in Northwest Europe down by Eur5/mt day on day to Eur660/mt ex-works Ruhr July 14.

“Market is almost dead,” a service center source said. “Demand from automotive industry is there, but construction and other industries is weak. And market has weakened further as Europe is entering slow summer period.”

Platts assessed domestic prices for hot-rolled coil in South Europe at Eur655/mt ex-works Italy July 14, unchanged day on day.

Tradable values have been heard at Eur650-660/mt ex-works Italy, and offers have been close to Eur700/mt ex-works Italy.

The strengthening of the euro against the US dollar has resulted in a price decline for imported coil. Although European buyers have shown little interest in overseas coil due to long lead times, they have been trying to use cheaper imports as leverage in negotiations with the EU mills.

Platts assessed imported prices for hot-rolled coil in South Europe down by Eur5/mt day on day to Eur595/mt CIF Italy July 14.

Offers of HRC from Vietnam have been heard at $640-$650/mt CIF Italy and from other Asian suppliers around $670/mt CIF Italy.

Author Maria Tanatar