The European hot-rolled coil market paused for breath Sept. 2 with buyers increasingly concerned about declining metal availability, sources told S&P Global Platts.
The daily Platts TSI index for HRC Northern Europe slipped Eur2/mt lower on the day Sept. 2 to Eur449/mt ($531.17/mt) ex-works Ruhr, while CRC dropped by Eur2.50/mt to Eur526.00/mt ex-works Ruhr.
The Southern European HRC index gained Eur1.50 on the day to Eur446/mt ex-works S.EU.
Activity particularly in the Italian market picked up, with HRC buyers starting to look towards northern European mills to secure volumes.
An Italy-based steel service-center source said that the distribution sector has started to buy larger volumes and Italian suppliers would not meet the current spike in demand.
“The [supply] situation in Italy is quite dramatic, Ilva is only producing 3 million mt instead of 9 million mt,” the source said, adding he would be looking to buy from Northern European mills as the narrow regional spread between north and south would allow him to do so.
“There is some sort of sensationalism in the market with increasing offers,” said the source, adding that demand would be “sustainable” for now but that outlook into late Q4 would be difficult to predict.
A Benelux-based stockholder said he now expected consolidation in prices following sharp gains achieved in August.
“I am optimistic but think we will see stable prices for the next few weeks as customers look to assess the market and decide on strategies,” he said.
“We have seen incredible increases over the summer and now hearing lead times extending, everyone now knows that prices are higher and they will book fearful of further increases – this will add to the momentum for higher prices.”
The source said that customer RFQs were now back to presummer levels but that it would take a few more weeks to complete negotiations.
— Len Griffin, Laura Varriale