Prices for steel hot-rolled coil in Northern Europe increased on Friday July 3, supported by higher mill offers, while Italian prices edged lower amid uncertainty following the introduction of new EU steel import quotas and subdued trading activity, sources told Fastmarkets on Friday.
In Northern Europe, a supplier reported an offer for September-delivery material at €720 ($823) per tonne ex-works on Friday, but the price was discarded because it fell outside Fastmarkets’ six-week maximum delivery window.
A buyer reported that a major supplier had raised its offer price by €20 per tonne to €690 per tonne ex-works, adding that “other mills speak of good order books, but don’t want to talk about prices.”
Market participants reported limited trading activity on Friday, with many still assessing the effect of the new EU steel import quota system that came into force on July 1.
“The shock is setting in, and some people have already been told to pay some duties. First, we are going to see some distressed cargoes have to be shipped elsewhere,” a trade source said on Friday.
The same source added that most quotas were likely already exhausted, although Fastmarkets could not independently confirm this through European Commission data.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was calculated at €695.00 ($793.28) per tonne on July 3, up by €4.06 per tonne from €690.94 per tonne on Thursday July 2.
The index was up by €12.50 per tonne week on week and by €5.00 per tonne month on month.
Market conditions in Italy differed from those in Northern Europe, with sources reporting that domestic mills had largely withdrawn offers while assessing the effect of the new quota regime.
Market participants linked this to Italy’s greater reliance on imported HRC compared with Northern Europe, making the market more directly exposed to the new regulation.
“Italian mills pulled their quotes [because] they need to announce new price levels,” a supplier told Fastmarkets on Friday, but was unable to provide a workable price indication because of this.
A buyer source provided an indication of achievable prices at €670 per tonne ex-works on Friday, while previous indications were mainly heard at €680 per tonne ex-works on July 2. The same source, however, said market conditions could change quickly as participants adapt to the new import regime.
Fastmarkets’ assessment of daily steel hot-rolled coil index domestic, exw Italy was €676.67 per tonne on July 3, down by €3.33 day on day from €680.00 per tonne.
The index was up by €8.54 per tonne week on week and up by €4.42 per tonne month on month.
