Steel HRC prices firm in Europe, but higher offers yet to be accepted

European prices for steel hot-rolled coil held steady on Tuesday November 14, with producers mulling further price rises and buyers holding back from further purchases to digest the recent bullish trend, industry sources told Fastmarkets.

HRC prices in Europe have started to pick up in recent deals, with all European steelmakers announcing higher offers.

For deliveries of HRC within 6-8 weeks, offers were reported at €680-700 ($727-748) per tonne ex-works from integrated mills in Northern Europe.

Transactions have been reported at €640-660 per tonne ex-works in the region, but traded volumes were still limited, because buyers wanted to wait and see if the increases were sustainable given the slow end-user demand.

“It seems that buyers realize now that prices will go up, by €30 or €50 per tonne [compared with October spot sales], so we will have to see [what will happen next],” a trading source in Northern Europe said. “But all will be determined by demand developments. There is still no clear vision, and some people expect an increase for the first quarter [of 2024], while others see stable [but] low demand for at least the first half of 2024.”

Market sources also said that European mills might put forward another round of price rises for coil with February-March lead times, to €700-730 per tonne ex-works.

“It will be hard to consolidate higher prices in deals while demand remains low,” a second trading source in the region told Fastmarkets. “I don’t think ‘anything starting with a 7’ [meaning prices of €700 per tonne or higher] is unrealistic at the moment.”

Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe, at €653.00 ($697.99) per tonne on November 14, up by €0.71 per tonne compared with €652.29 per tonne on November 13.

The index was up by €13.00 per tonne week on week and by €35.92 per tonne month on month.

In Southern Europe, Fastmarkets calculated its corresponding daily steel HRC index, domestic, exw Italy, at €630.00 per tonne on Tuesday, unchanged since November 10.

The Italian index was up by €8.75 per tonne week on week and up by €36.98 per tonne month on month.

The Italian market was also quiet on Tuesday, with some steelmakers still holding back offers, while the general mood remained bullish.

For December delivery, offers of HRC from integrated mills were heard at €630 per tonne ex-works, with another rise by €30 per tonne ex-works under consideration for January deliveries.

Consumption was still weak in Italy, but price rises were backed by some restocking activity and production cuts.

Imported coil was still uncompetitive in Europe due to the long lead times, low estimated quota allocations, and rather high offer levels in general.

January-shipment HRC offers from Vietnam were heard at €610 per tonne CFR to Italy, sources said.

January-shipment offers of HRC from South Korea and Japan were reported at €615-620 per tonne CFR.

And Turkey-origin coil for December shipment was offered to European ports at €640 per tonne CFR, without anti-dumping duty.

Published by: Julia Bolotova