HRC prices stabilize in Europe; buyers skeptical about further increases
Market sources held different views about future price moves for European HRC.
Notably, some suppliers were mulling price rises, pushing June-delivery HRC offers up to €680 ($737.65) per tonne delivered from €660 per tonne delivered.
Buyers, in their place, said that further price rises could not be justified given a lack of demand.
“Steel safeguards on HRC are not as tough as expected – imports will be back, and a weaker dollar against the euro is also supportive of this,” a buyer source in Germany said.
So far, sources reported only limited restocking activity in Northern Europe, mainly hand-to-mouth activity in the spot market amid subdued consumption.
Buyers in Germany and the Benelux area estimated achievable prices at €630-650 per tonne ex-works.
“Yes, there will be tighter supply [of HRC] in Q2 due to the Salzgitter force majeure, ArcelorMittal maintenance, but the market is not going to miss these tonnages unless demand picks up and we need more steel. A further push to increase [HRC] prices should come from demand,” a second buyer said.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €636.19 per tonne on Thursday, up by €0.10 per tonne from €636.09 per tonne on Wednesday.
The Northern European index was up by €5.25 per tonne week on week and by €32.86 per tonne month on month.
In Southern Europe, meanwhile, Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €620.00 per tonne on Thursday, down negligibly by €0.33 per tonne from €620.33 per tonne on Wednesday.
The index was stable week on week and up by €26.43 per tonne month on month
Offers for May-delivery HRC from two Italian suppliers were reported at €620-640 per tonne delivered (€610-630 per tonne ex-works).
Italian buyers estimated tradeable values at €600-620 per tonne ex-works on Thursday.
One source even said that producers might have to step back to €600-620 per tonne delivered (590-610 per tonne ex-works) shortly, because HRC imports “are coming back.”
Earlier this week, new adjustments to steel safeguard measures in the EU were revealed with HRC restrictions that were deemed to be not tough enough.
As for imports, sources reported May-shipment HRC offers from Indonesia at €540-550 per tonne CFR.
And from Turkey, two buyer sources both reported offers at €580-590 per tonne CFR, including the anti-dumping duty.
“Turkey has a big quota they don’t fully use, so they remain a safe option. And Indonesia [and] Malaysia offers at really competitive prices now, especially considering the weaker dollar against the euro,” a third buyer source said.
European HRC prices inch up; market digests safeguard news
Northern Europe
Offers for May-delivery HRC from major steelmakers in Northern Europe were reported at €640-660 ($694-715) per tonne ex-works, but sources were not ruling out the possibility of a fresh round of price rises shortly.
Sources reported mainly hand-to-mouth activity in the spot market, with buyers digesting safeguards updates and postponing big purchases.
In the Benelux area, transactions for small tonnages of HRC were reported at €650 per tonne ex-works.
In Germany, buyers estimated achievable prices at €630-640 per tonne ex-works.
Italy-origin HRC was offered to Germany at €650-660 per tonne delivered.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €635.83 per tonne on Tuesday, up by €3.95 per tonne from €631.88 per tonne on Monday
The Northern European index was up by €6.79 per tonne week on week and by €34.43 per tonne month on month.
Italy
In Southern Europe, meanwhile, Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €620.00 per tonne on Tuesday, unchanged day on day.
The index was up by €1.67 per tonne week on week and by €26.25 per tonne month on month.
Offers for May-delivery HRC from two Italian suppliers were reported at €620-640 per tonne delivered (€610-630 per tonne ex-works).
But sources said that target prices for June was around €660-680 per tonne base delivered (€650-670 per tonne ex-works).
Buyers’ estimations of tradeable values were reported at €610-620 per tonne ex-works on Tuesday.
Trading was also quiet in Italy since buyers remained cautious with bookings because they were waiting to have more clarity on safeguard measures.
“Real demand is still weak. Price rises is supported only by safeguards review,” a buyer in Italy said.
Safeguard reaction
The market was digesting news about safeguards adjustments, made available on Tuesday, and it looks like the changed proposed by the European Commission fell short of everyone’s expectations.
Among other things, the Commission suggested a reduction to the HRC cap per country over the tariff rate quota (TRQ) volume initially available in each quarter from 15% to13%.
On top of that, quarterly HRC allocations will be reduced as a result of removing “sanctioned” Russian HRC tonnages from quotas.
In general, the market had mixed reactions to the proposed safeguard measure adjustments.
Mill sources said the proposed measures fell short of expectations and they were “disappointed.” Buyers, in their place, lambasted the quota reductions and cap introduction for a number of steel products.
“[A] cap [was] introduced for nearly all products – plate, CRC, rebar – you name it, all are there. Looks like they want to stop us from importing steel altogether,” a trading source said.
“Looks like the current measures are balanced this time; nobody’s happy, neither mills nor buyers,” a second buyer said.
“HRC quotas are cut by no more than 11% in total, against expectations of 15-50%. It’s a joke. No more than 1 million tonnes of [HRC] imports will be gone [from the EU market] as a result [of new safeguards],” a mill source said.
Nonetheless, the stricter safeguards, along with higher domestic supply, were expected to support domestic HRC prices rebound, sources said.
Tighter domestic supply
On Monday, ArcelorMittal announced a major maintenance program in France, which would entail 90 days stoppage of a blast furnace in Dunkirk.
The maintenance will take place during April-June. At the same time, as of April, reviewed safeguards were expected to come into force, limiting import coil supply.
Industry sources suggested these two factors would likely support a further HRC price rise in Europe.
“Real demand is not there, but tighter supply [of HRC] might boost apparent consumption,” a buyer source said.
On top of that, German steelmaker Salzgitter has declared force majeure on flat steel deliveries, following a fire at its hot strip mill in end-February.
Several sources familiar with the matter said that operations at Salzgitter’s hot-strip mill had been resumed on March 7, and estimated output losses as a result of the fire to be around 80,000 tonnes of HRC.
The company had not responded to requests for comment about the loss of production and an equipment restart date by the time of publication.
European CRC, HDG prices increase on limited availability
The upward trend was even stronger in the Northern European market due to force majeure circumstances, affecting production of German steelmaker Salzgitter’s hot-rolling mill, Fastmarkets understands.
A fire occurred at the hot-rolling mill at Salzgitter Flachstahl in southeast Lower Saxony, Germany on February 28, which limited deliveries and production for hot-rolled, cold-rolled and hot-dipped galvanized coil, Fastmarkets reported.
According to industry sources, this event could support the domestic flat steel prices up further in Germany.
Northern Europe
Mills in Northern Europe were heard offering mid-May/June delivery CRC at €730-750 ($769-790) per tonne ex-works, industry sources told Fastmarkets.
In comparison, lower offers were available in the market at €710-740 per tonne ex-works in the previous assessment week.
Fastmarkets’ sources estimated the tradeable market level for CRC during this assessment week at €720-740 per tonne ex-works, with some buyers saying that €700 per tonne ex-works could still be negotiated.
Fastmarkets’ weekly price assessment for steel cold-rolled coil domestic, exw Northern Europe was €700-740 per tonne on Wednesday, increasing by €10-30 per tonne from €690-710 per tonne on February 26.
Some small volume transactions with imported CRC from Taiwan and South Korea were heard at €670 per tonne CFR Antwerp, industry sources told Fastmarkets.
An upward trend was also observed with the domestic HDG prices in Northern Europe, Fastmarkets understands.
Offers of the material were heard at €740-750 per tonne ex-works, with buyers estimating the workable market level at €720-740 per tonne ex-works.
As a result, Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil domestic, exw Northern Europe was €720-740 per tonne on Wednesday, increasing by €5-10 per tonne from €710-735 per tonne on February 26.
Asia-origin imports of HDG to Northern Europe were considered unattractive due to the trade risks and the fast exhaustion of the current quotas, industry sources told Fastmarkets.
Italy
CRC and HDG prices in Italy were also increasing gradually during the assessment week to Wednesday March 5, industry sources told Fastmarkets.
The latest offers of domestic CRC heard available in the market were €710-740 per tonne ex-works, Fastmarkets understands.
However, buyers’ estimations for the tradeable market level were lower at €700-710 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel cold-rolled coil domestic, exw Southern Europe was €700-710 per tonne on Wednesday, up by €10 per tonne from €690-700 per tonne on February 26.
Asian suppliers were heard offering CRC in the Italian market at €650-660 per tonne CFR.
Indian suppliers were heard selling some CRC volumes to Italy at €650 per tonne CFR, industry sources told Fastmarkets.
Regarding domestic HDG prices, local suppliers were heard offering the material at €730-740 per tonne ex-works.
Buyers’ estimations for the tradeable market level were at €720-730 per tonne ex-works.
Fastmarkets’ price assessment for steel hot-dipped galvanized coil domestic, exw Southern Europe was €720-730 per tonne on Wednesday, up by €20 per tonne from €700-710 per tonne on February 26.
European HRC steel producers still bullish despite subdued real demand
In the Benelux area, transactions for HRC lots of 1,000 tonnes were reported at €630 ($654) per tonne ex-works for April-May delivery.
In Germany, deals were reported at €620-630 per tonne ex-works.
Buyers’ estimates of tradeable values for HRC across Northern Europe were heard at similar levels of €620-630 per tonne ex-works on Monday.
Market sources noted that the uptrend was expected to persist in the coming weeks, despite a lack of real demand.
“Customers are complaining [about HRC price increases] but they are still ordering. New safeguards are coming [from the EU authorities], so very few buyers dare to book imported coil,” a supplier in the region said.
“It is clear that if you don’t book [HRC] today, tomorrow you’ll have to pay more,” a buyer source in Germany said.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €627.92 per tonne on Monday, up by €1.09 per tonne from €626.83 per tonne on Friday.
The Northern European index was up by €9.17 per tonne week on week and by €36.67 per tonne month on month.
Meanwhile, in Southern Europe, Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €616.25 per tonne on Monday, up by €3.75 per tonne from €612.50 per tonne on Friday.
The index was up by €6.25 per tonne week on week and up by €28.75 per tonne month on month.
In Italy, buyers’ estimates of achievable prices were reported within the range of €600 to €625 per tonne ex-works on March 3. Some sources, however, pointed out that the lower end of that range was no longer achievable.
European suppliers were offering May-delivery HRC to Italy at €660 per tonne delivered.
An Italian mill was hoping for €640-660 per tonne delivered for April-May delivery HRC, trade sources said. Trading activity has improved recently, but was “far from booming,” they added.
“Everyone buys hand-to-mouth. There is too much uncertainty around safeguards, and real demand is still not supportive of huge price rises,” a buyer in Italy said.
“Real demand for steel remains subdued, but apparent demand has picked up due to the situation with [the safeguards review on] imports, and expectations of a continued uptrend,” a second buyer in Italy said. “The market [for HRC] is very speculative now.”
Regarding imports, offers to the European market were still limited.
Asia-origin coil with April-May shipment was offered to Italy at €560-570 per tonne CFR.
Turkish suppliers were offering coil at €590-600 per tonne CFR, including anti-dumping duty/
More clarity on the situation regarding imports was expected by the end of March, when the current review of the European Commission’s steel safeguards was expected to be completed.
European HRC prices broadly stable amid uncertainties over safeguard measures
European HRC buyers were partially accepting higher offers for HRC, however traded volumes were still limited, sources said.
First-tier suppliers in Northern Europe were reportedly sold out for April-delivery coil and were offering HRC with May lead times around €640-660 ($669-689) per tonne ex-works.
Italy-origin HRC with April-May lead times was offered in Germany at €640-650 per tonne delivered.
Most buyer sources estimated tradable prices at €620-630 per tonne ex-works, Fastmarkets understands.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €626.83 per tonne on Friday, up marginally by just €0.16 per tonne from €626.67 per tonne on Thursday.
The Northern European index was up by €8.70 per tonne week on week and by €38.39 per tonne month on month.
Industry sources said they were expecting the uptrend to persist in the upcoming weeks — supported by restocking and limited availability of imports due to safeguards review and pending anti-dumping probe into certain origins.
Notably, the European Commission was expected to complete the steel safeguard measures review by the end of March, with any potential adjustments taking effect the following month.
Meanwhile, in Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €612.50 per tonne on Friday, stable day on day.
The index was up by €5.42 per tonne week on week and by €30.00 per tonne month on month.
In Italy, most buyers estimated achievable prices at €610 per tonne ex-works on Friday.
Italian producers were offering April-May delivery HRC at €620-640 per tonne delivered, which would net back to €610-630 per tonne ex-works.
Trading was subdued in the nation, with buyers delaying purchases and awaiting more clarity on the steel safeguards measures review.
In the week to Friday, import HRC offers were broadly stable compared with the previous week.
From Asia, offers were reported at €550-580 per tonne CFR to Italy.
From Turkey, offers were reported at €590-600 per tonne CFR to Italy.
Overseas suppliers were offering HRC to Europe with lead times in the second quarter, so importing coil was getting increasingly risky since new safeguard measures were expected to take effect in April.
EU HRC markets remain focused on safeguard review
European hot-rolled coil prices remained sideways Feb. 26 amid an ongoing focus on regulatory concerns and stable demand fundamentals.
When asked about the proposed delay to the EU Carbon Border Adjustment Mechanism legislation, a North European service center source stressed that the current safeguard investigation outcome had a more immediate bearing on the market and was a key contributor to quieter import conditions.
“Everyone is waiting for the quota announcement,” said the source. “The quota poses more risk of cost penalties if you exceed it, and if we limit it, we also limit imports so we could see domestic prices climb quickly.”
“We also don’t know how much material is sat in EU harbors, waiting to be [customs] cleared so a smaller import quota, especially on certain products, could be quickly filled and a problem.”
Other midstream buyers shared expectations of further price increases, with a distributor saying, “Demand is still very low, with some doing speculative purchases as they anticipate the next price increases.”
A South European service center source pointed to an improved mood in the market, but demand and regulatory uncertainty were limiting momentum. According to the source, “The market is quite ready to move prices, but demand is slow and not allowing the room.”
“The service center market is concerned about the safeguards; the situation will be better when the review is announced,” the source added.
Platts assessed HRC in Northwest Europe and South Europe at Eur605/mt EXW Ruhr and EXW Italy, respectively, both stable day over day.
Platts assessed imported HRC prices in Northwest Europe unchanged at Eur550/mt CIF Antwerp, while the South Europe market also remained stable at Eur545/mt CIF Italy.
European HRC prices hold firm as market eyes quota decision
European hot-rolled coil prices remained largely stable on Feb. 20, with sources pointing to a combination of cautious buying and expectations of further increases amid ongoing discussions on safeguard quotas and import restrictions.
Market sentiment was mixed, with mills and traders closely monitoring developments on the European Commission’s safeguard measures, expected to be announced later this week, some sources noted. While some market participants remained confident that the quota adjustments would help stabilize domestic prices, others were concerned about persistently weak demand.
A mill source highlighted the uncertain demand outlook. “We have taken the projection that there will be no growth in Europe,” the source said. “Real demand is still concerning, and many buyers remain risk-averse. That being said, restocking later in the quarter could provide some support.”
Despite these concerns, domestic mills continued to push for higher prices. Tier 1 mills in Northwest Europe were reported to be offering HRC at a minimum of Eur600/mt ex-works Ruhr, with tradable values ranging at Eur600-630/mt for specialty applications. Meanwhile, in Iberia, tradable values were reported at Eur610-620/mt ex-works.
A trader noted that higher import costs had limited the competitiveness of non-EU suppliers, helping to support European prices.
“Imports aren’t very attractive right now due to quota risks, taxes, and uncertainty around arrivals. That should continue to prop up domestic prices,” the source said.
Offers for imported HRC into Northwest Europe were heard at Eur550-560/mt CIF Antwerp from Indonesian suppliers for June arrival, while in South Europe, Turkish material was reported around Eur600/mt CIF Italy, duty paid.
In addition to the safeguard discussions, sources also cited supply-side factors as a key influence. “Some mills are stepping back from the market as they look to return with higher prices,” a distributor said.
Meanwhile, carbon-accounted HRC offers were heard at Eur200/mt, although volumes in this segment remained small.
Platts assessed HRC in Northwest Europe at Eur605/mt EXW Ruhr, stable on the day. Platts assessed HRC in South Europe at Eur610/mt EXW Italy, up Eur10 on the day.
Platts assessed imported HRC prices in Northwest Europe at Eur550/mt CIF Antwerp and South Europe at Eur550/mt CIF Italy, both stable on the day.
European HRC prices rise in recent trades; sentiment remains positive
European HRC buyers were partially accepting higher offers in recent trades, sources said.
“Buyers are still cautious with volumes and instead of buying, for example, 5,000 tonnes [of HRC, they will] book 2,500. But inquiries did improve,” a mill source in Northern Europe said.
First-tier suppliers in Northern Europe were offering HRC with April-May lead times at €630-660 ($659-690) per tonne delivered (€620-640 per tonne ex-works).
Transactions were reported at €615-620 per tonne ex-works in Germany.
Italy-origin HRC with April lead times was offered in Germany at €640-650 per tonne delivered.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €618.13 per tonne on Friday, up by €7.25 per tonne from €610.88 per tonne on the previous day.
The Northern European index was up by €14.38 per tonne week on week and by €40.63 per tonne month on month.
Industry sources expected the uptrend to persist in the upcoming weeks – supported by restocking and limited availability of imports.
But several buyers sources expressed concerns about the viability of the further price increase, considering slow end-user demand.
“This entire [HRC] price recovery cannot be entirely based on the import situation. There is no major recovery in sight for steel-consuming industries: construction, automotive, etc,” a buyer said.
“It’s difficult to say [if the price recovery will continue]. Maybe we will see a slight [demand] improvement in the second quarter, but will it be enough?,” a second buyer said.
Sources previously said they expect more clarity regarding new safeguards measures next week.
Meanwhile, in Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €607.08 per tonne on Friday, up by €7.08 per tonne from €600.00 per tonne on Thursday.
The index was up by €11.66 per tonne week on week and up by €33.33 per tonne month on month.
In Italy, buyers estimated achievable prices at €600-610 per tonne ex-works on Friday.
Italian producers were offering April-delivery HRC at €620-640 per tonne delivered (€610-630 per tonne ex-works).
In the week to Friday, import HRC offers were broadly stable.
Most overseas suppliers were offering HRC to Europe with lead times in the second quarter, making imports increasingly risky since new safeguard measures are expected to come into effect in April.
From Asia, offers were reported at €550-570 per tonne CFR to Italy. Offers from Ukraine were reported within a similar range.
HRC from Turkey was on offer to Italy at €590-600 per tonne CFR, including the anti-dumping duty, sources told Fastmarkets. Several sources said that for big volumes it was possible to achieve €570-580 per tonne CFR. Several sources reported deals within the range €570-580 per tonne CFR from Turkey to Italy during the assessment week, but no further details were available at the time of publication.
Limited imports, restocking support European HRC prices recovery
However, the lack of new imports due to trade measures was still named the major driver for a price rebound, Fastmarkets heard.
European buyers were cautious about booking HRC from imports due to pending safeguard measures and the potential trade risks these might create, sources said.
German mills were aiming for €630-660 ($660-692) per tonne ex-works for April-delivery HRC, “with a minimal room for discounts,” sources said.
A major mill in the Benelux area was offering HRC at €630-640 per tonne ex-works.
Buyers in Northern Europe estimated tradable values at €600-620 per tonne ex-works on Tuesday.
One buyer in Germany said that it was “nearly impossible to get HRC below €620 per tonne ex-works from German mills.”
As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €606 per tonne on Tuesday, up by €1 per tonne from €605 per tonne on Monday.
The Northern European index was up by €4.60 per tonne week on week and by €32.25 per tonne month on month.
Meanwhile, in Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €597.50 per tonne on Tuesday, up by €2.50 per tonne from €595.00 per tonne on Monday.
The index was up by €3.75 per tonne week on week and up by €27.50 per tonne month on month.
In Italy, local producers were also aiming for higher prices, sources said.
Notably, one mill in the nation was aiming for €640 per tonne delivered (€630 per tonne ex-works) for April-delivery coil, while another targeted €620 per tonne delivered (€610 per tonne ex-works). This was an increase from €610-620 per tonne delivered and €590-600 per tonne delivered for March lead times respectively.
A European supplier was offering HRC with second quarter lead times at €660 per tonne delivered to Italy.
However, none of the mentioned offers was considered workable by Italian buyers.
“The level of stock [at buyers’ disposal] allows them [buyers] to wait. New offers are too high, the downstream market is still rather weak, so purchasing [HRC] at prices above €600 [per tonne ex-works] is not viable for us,” a steel service center in Italy said.
Buyers’ estimations of tradable values were still reported at €590-600 per tonne ex-works, but since mills were standing firm on new offers, no transactions were reported on Tuesday.
“There are very few transactions these days if any,” a buyer source said.
Meanwhile, the market for overseas coil was also quiet. Safeguards review as well as anti-dumping probe into certain origins were limiting buying appetite for imports, sources said.
Turkey was heard offering April-shipment HRC to Italy at €590-600 per tonne CFR, including the anti-dumping duty, to European ports.
Indian coil was offered at €560 per tonne CFR to Southern Europe.
Limited imports support European HRC price recovery
However, according to market participants, the current positive trend in the European HRC market is not so much demand-driven but related to the lack of strong competition from imports.
The latest steel safeguard review of the European Commission, launched in December, sparked uncertainty among local buyers, decreasing their appetite to purchase imported HRC. Thus, European customers started to rely more on domestic production.
Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €603.33 ($625.74) per tonne on Thursday, up by €0.83 per tonne from €602.50 per tonne on Wednesday.
The Northern European index was up by €3.33 per tonne week on week and by €30.83 per tonne month on month.
One leading European mill has started offering April-May delivery HRC at €660 per tonne ex-works or delivered, depending on the destination, since last week, Fastmarkets understands.
Other mills in Northern Europe were heard offering HRC for delivery in the second quarter of the year at €610-630 per tonne ex-works.
Some transactions were reported at €600 per tonne ex-works, industry sources told Fastmarkets.
Buyers estimated the workable market level for HRC in Northern Europe at €595-605 per tonne ex-works.
Meanwhile, in Southern Europe, Fastmarkets’ corresponding daily steel hot-rolled coil index domestic, exw Italy was calculated at €593.57 per tonne on Thursday, up by €0.24 per tonne from €593.33 per tonne on Wednesday.
The index was down by €0.18 per tonne week on week and up by €28.57 per tonne month on month.
Local suppliers were heard offering April-delivery HRC at €600-630 per tonne delivered, which would net back to €590-620 per tonne ex-works.
One European supplier was offering HRC with second-quarter lead times to Italy at €660 per tonne delivered, which would be equivalent to €650 per tonne ex-works, Fastmarkets understands. According to industry sources, discounts of €10-20 per tonne were possible.
Buyers’ estimates for the workable market level for HRC in Italy were at €590-600 per tonne ex-works, with the upper end of the price range considered challenging for local customers.
“[Levels at] € 600 per tonne ex-works [are still] a problem for the buyers at this stage because the downstream market is not [performing] great, but apparently there are no alternatives,” a buyer source based in Italy told Fastmarkets.
In terms of imports, no fresh offers or deals were heard in the European market.