Slow buying, competitive imports put pressure on European CRC, HDG prices

Slow trading and low-cost imports dragged down European cold-rolled and hot-dipped galvanized steel prices in the week to Wednesday April 19, despite constrained domestic supplies, sources told Fastmarkets.
Major European flat steel producers have largely being out of the market in recent weeks.

Lead times for domestic CRC and HDG in Northern Europe have extended into the third quarter due to the declaration of force majeure at Tata Steel IJmuiden in the Netherlands, among other things.

European producers have good order books and are not, therefore, chasing for orders, sources said.

“The Tata Steel problem also caused longer lead times from German mills, because buyers have had to look for alternative [suppliers there],” a buyer in Northern Europe told Fastmarkets.

In addition, Tata Steel has been booking CRC from other European mills to feed its galvanizing lines, sources said.

Trading in the spot market has been extremely quiet in recent weeks.

Some mills were aiming for about €1,000 ($1,096) per tonne delivered (€980 per tonne EXW) for HDG and about €980 per tonne for CRC (€960 per tonne EXW). But those The target offer prices were not considered workable by buyers, who said the recent uptick in automotive demand might not be sustainable.

“Production figures for the automotive industry are improving, but at the same time subcontractors are desperately looking for alternatives [HRC supplies] because of supply disruptions,” a second trading source said.

Buyers estimated that the workable level in Northern Europe for CRC was more like €940-950 per tonne EXW and about €960-970 per tonne EXW for HDG for Northern Europe.

An HDG sale from Italy to Germany was reported at €970-980 per tonne delivered for June delivery in the week to Wednesday.

Fastmarkets’ weekly price assessment for steel CRC, domestic, exw Northern Europe, was €940-950 per tonne on Wednesday, narrowing down by €10 per tonne from €940-950 per tonne on April 12.

The corresponding weekly price assessment for steel HDG, domestic, exw Northern Europe, was €960-970 per tonne on Wednesday, down by €10 per tonne from €970-980 per tonne seven days earlier.

Imports
The gap between domestic and import price has been growing, along with lead times from domestic mills now almost in line with imports, thereby making overseas bookings more attractive, sources told Fastmarkets.

A booking of CRC from India with June shipment was reported during the assessment week at around €840 per tonne CFR Antwerp.

And Vietnamese and South Korean CRC was on offer to Southern Europe at €820-830 per tonne CFR, for June shipment.

A Japanese mill, meanwhile, was offering CRC to Europe at $900 per tonne CFR Antwerp, also for June shipment.

An offer for 0.5mm z100 HDG from Vietnam was reported at $990 per tonne CFR Antwerp, for July shipment.

Published by: Julia Bolotova