
EU stainless flats start year slow
The European stainless flat steel market is experiencing a slow recovery this year, stainless steel processors and service centres tell Kallanish.
EU coil producers are increasing their prices by €20-30/tonne ($20.8-31.2/t) for March delivery. This, however, will face resistance from buyers because of the challenges in transferring the increases downstream. Certain mills are currently quoting lead times for March, while others continue to fill February order books. This year, there has been some increase in orders for sheets, a source in Italy reports. He indicates a lead time for sheets extending to the end of March. Orders for tubes, however, continue to show subdued demand.
Several coil buyers have voiced their apprehensions regarding the 8% duties they will be required to pay for coils imported from Indonesia. Prevailing sentiment among buyers discourages taking part in the import market. In northern and western Europe, stainless cold rolled coil for February delivery is at €2,450-2,460/t delivered. The market price for Italian stainless CRC stands at €2,400/t delivered. Stainless hot rolled coil in Europe, including Italy, is ranging between €2,150-2,200/t delivered.
Distribution prices are experiencing persistent downward pressure, reflecting trends observed in the fourth quarter. Distributors and service centres tell Kallanish they are struggling to implement price increases, leading to significant negative financial impacts. Flat product stocks in northern and central Europe are currently assessed as moderately low, while those in Italy are said to be higher. Current pricing for sheets in Europe is reported to average €2,550-2,600/t delivered, with Italy slightly lower at €2,500/t, according to sources. Current scrap prices are not supporting finished products. The European stainless scrap market is marked by a lack of significant activity. Scrap demand from mills in Europe is subdued, largely due to their continued procurement of cheaper slab and nickel pig iron from Asia. Steel producers are anticipated to continue sourcing these materials, whereas demand for scrap is expected to remain weak in the coming months.
“The significant contraction observed in purchasing activity aligns with the overall performance of the European industrial sector… Many believe that the current persisting demand weakness is likely to continue throughout the entire first quarter,” Italian trade association Assofermet says in a market note seen by Kallanish. This year, the market will face challenges due to rising energy costs, potentially resulting in price hikes as companies strive to restore their margins.
Natalia Capra France

Erste: European automotive suffers loses, Chinese industry booms
European automotive producers are losing out on the Chinese market, which is still crucial for their sales, according to Erste Group research.
In the past five years, the share of German brands in the Chinese market has decreased by 6 percentage points. “Earlier, for example, Volkswagen sold about a third of its global car production in China in 2023. Over the last ten years, passenger car production in Asia has increased by 33%, and in China even by 68%. By contrast, it has fallen by 11% in Europe and by 24% in Germany,” Erste notes in a report.
Moreover, Europe’s share of global passenger car production has fallen from 28% to 23%, while Asia’s has risen from 56% to 68% during 2012-2023, the document shows.
“The share of European passenger car production in total world production is falling, but European countries are still among the world’s major car manufacturers: Seven of the top-15 passenger car manufacturers are from Europe,” Erste Group notes. “Fortunately, Chinese companies have not yet established themselves in Europe. The most difficult situation today is in the German car industry. The point is that, in Germany, the unit labour costs in the automotive industry are two times higher than in Italy or Spain and three times higher than in the Czech Republic and other CEE countries.”
The most delicate situation is at Volkswagen, whose management plans to close up to three –of 10 – German factories, cut VW employee wages by 10% and conduct layoffs. The unions, on the other hand, want the carmaker to give pay rises, Kallanish notes.
According to the bank, one option is to move production to a cheaper foreign country. “This is already happening, as German production of passenger cars reached a peak before Covid-19 in 2016. It has been declining ever since. On the other hand, in countries like the Czech Republic and Slovakia, passenger car production has been rising,” the report observes.
Global motor vehicle production reached its all-time high in 2017, with 97 million motor vehicles produced worldwide, 70% of which were passenger cars, Erste Group says. Then came the pandemic and production fell by a quarter by 2020.
Production reached 93m units last year and was only 4% below the 2017 record.
Svetoslav Abrossimov Bulgaria

First long-term coil contracts struck in Europe
The traditional negotiations between big coil buyers and northwestern European mills have been rather subdued this year, but the first results have been obtained by Kallanish.
“Normally, the coil trade fair is the starting point of negotiations but, this time, the mills did not even give an offer,” says one participant who attended October’s Euroblech trade show in Hanover.
Some bids had already come in from buyers then, who were asking for a hefty €200/tonne ($212) reduction in comparison to the agreements struck one year ago. Against that, mills were later heard asking for a rollover, but that attempt has floundered. “Mills are not trying for that any more, certainly not in unison,” one well-connected observer says. “And for mills, a minus of €200 would break their necks,” another notes.
The slow motion of the talks this year became clear at thyssenkrupp’s annual results conference in November. A big share of the steelmaker’s output goes to carmakers and industries on long-term contracts. “They [the contract talks] are still outstanding,” a thyssenkrupp executive said during the 19 November conference. He made reference to “the beginning of the year”, suggesting deals would only be agreed in early 2025.
According to one observer, mills are currently gunning for a year-on-year reduction of €80/t and buyers for a €120/t cut. “ I think this might still drag for on a while,” he says.
One buyer concurs and says he only knew of one deal by hearsay. “Rumour has it that [one mill] signed for minus €90”, apparently with a player in the automotive industry. “That would not be too bad for mills, as long as the figure is not three digits,” he finds.
Another buyer claims his company has achieved exactly that in more than one deal signed, with a y-o-y reduction of €130 on average. The firm only agrees half-year contracts. Buyers that prefer full-year contracts might therefore have to make do with a lesser reduction.
Christian Koehl Germany

European HRC market experiences quiet start to the week
The price of European domestic hot-rolled coil remained largely unchanged, as the industry is now in the holiday season, with many market participants currently out.
Some market sources believe that mills are still attempting to test the market by increasing prices, but others remain skeptical, stating that consumer interest is not present enough in the market for there to be any change.
“I think European mills will definitely try to increase prices,” one trader said.
“Market is still too low and will be for the rest of the year,” a service center source said. “There is no activity in the market.”
With demand remaining low and supply remaining well ahead in Europe, some market sources have commented that mills are struggling to find orders.
“The market is flat, mills are desperate for quantities,” a distributor said. As long as consumption doesn’t pick up, there will not be any change in prices, the distributor added.
Platts assessed Northwest European HRC stable on the day at Eur625/mt ex-works Ruhr on July 15.
Meanwhile, Platts assessed domestic HRC prices in Southern Europe also stable on the day at Eur625/mt ex-works Italy on July 15.
Some indications were heard for carbon accounted steel, with an offer for premium reported at Eur95-140/mt, with a CO2 content around 0mt at scopes 1-2.
Platts assessed the carbon-accounted premium for HRC in Europe down Eur5/mt on the day at Eur120/mt July 15.
Geraint Moody