European steel hot-rolled coil prices remained under pressure from low demand among end users, with almost no trading because of summer vacation absences, industry sources told Fastmarkets on Wednesday July 31.
The HRC market in Europe went quiet in late July at the start of the vacation period.
“There is hardly any trading. Mills are quiet [and], despite drastically low demand, they seem to be unprepared to cut prices further,” a buyer sources in the Benelux area said.
Buyer estimates of the tradable price for HRC in Northern Europe were around €610-620 ($660-671) per tonne ex-works, and even as low as €590-600 per tonne ex-works in some cases.
Integrated mills in the region were offering September-delivery HRC at €630-650 per tonne ex-works, with some suppliers in Germany reported to be accepting €610-620 per tonne ex-works for bigger orders.
Two sources reported a transaction at €600 per tonne ex-works in the region, but this was not confirmed with other industry sources at the time of publication.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €620.71 per tonne on Wednesday, down by €4.29 per tonne from €625.00 per tonne the previous day.
The index was down by €5.54 per tonne week on week and by €9.17 per tonne month on month.
No significant progress was reported in negotiations for long-term contracts with original equipment manufacturers (OEMs) in the automotive industry for the second half of 2024, sources said.
“It looks like no consensus has yet been reached [for long-term contracts], but at the same time, that’s why mills don’t want to drop spot prices any further,” a second buyer in the Benelux area said.
For the first half of 2024, HRC contracts with automotive OEMs were reported to have been signed at €750-800 per tonne.
Buyers were said to have been seeking discounts of €100 per tonne for the second half of the year, while producers were hoping for a price rollover, market sources said.
In Southern Europe, meanwhile, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Italy at €620.63 per tonne on Wednesday, down by €0.62 per tonne compared with Tuesday’s €621.25 per tonne.
The index was also down by €0.62 per tonne week on week and down by €4.37 per tonne month on month.
The Italian market was seasonally quiet, with no major trades reported on Wednesday.
“Starting on August 1, the Italian market will be ‘closed’ for vacations, for two to three weeks,” a buyer in Italy said.
The most recent offers of September-delivery HRC from a mill in Italy were heard at €640-650 per tonne delivered (€630-640 per tonne ex-works). That price has been stable for several weeks, although a European mill was offering HRC to Italy around €620-630 per tonne delivered.
But buyer sources estimated that the workable price was €600-620 per tonne ex-works, although the lower end was not confirmed by sellers.
Sources suggested that local suppliers would undertake longer-than-usual summer stoppages in an attempt to balance the oversupplied market.
“We heard that [an Italian mill] is thinking about stopping production for the whole of August, rather than the traditional two weeks,” a buyer source in Europe said.
As for imports, market sources reported a booking for a large Turkey-origin cargo to Italy at €570 per tonne CFR, including duty. Smaller lots were offered to Southern Europe around €590 per tonne CFR (duty inclusive), or slightly below.
Market sources saw increased interest in Turkish HRC after new safeguard duties came into force in Europe.
“Turkey has a big quota, and quick shipment [times] compared with Asian countries, so those [HRC] buyers who need to book imports look at Turkey,” a second buyer in Italy said.
From Vietnam, offers were reported at €560-570 per tonne CFR. An unconfirmed offer was reported at €540 per tonne CFR to southern Europe and the Balkans, but for large volumes.
But recent news about a possible anti-dumping probe against Vietnamese HRC, along with new safeguard rules, was limiting buying interest in material from that origin.
From Ukraine, HRC was offered to Italy at €580-585 per tonne CFR.
Most overseas suppliers were offering October-shipment coil to Europe.
Published by: Julia Bolotova