Sentiments were cautiously optimistic in the UK HRC market July 29 with lower demand attributed to a slower summer period.
Platts assessed hot-rolled coil in the UK down GBP10/mt July 29, at GBP710/mt DDP West Midlands, UK.
Distribution sources reported the market as largely stable on the week, though tradable value indications did inch down on declining offer levels.
Market participants considered prices of GBP700-720/mt DDP as achievable on the day, with a large spread of available offers between domestic mills, and European and non-European imports.
Buyers continue to look predominantly toward European mills for supply efforts, based on competitive pricing and short lead times in uncertain market and geopolitical conditions.
European mill offers were heard on a range of GBP710-740/mt DDP UK, relatively stable on the week.
One mill was heard as having dropped its offer level from GBP740/mt to GBP710/mt DDP on the week, — albeit offered to different buyers — in line with cheaper offers from the same mill in the European market at Eur800-820/mt ex-works Northern Europe. Other prime mills remain at the Eur850/mt level, ex-works Ruhr.
Multiple sources reported discussions with a domestic mill on the day, though no price levels were yet settled. Expectations of offer levels surrounded the GBP700/mt mark, with distribution sources predicting a respective GBP10/mt above and below.
For non-European imports, Taiwanese material was offered at around GBP680/mt DDP UK.
Demand is yet to recover in the UK market, with end-user demand reportedly down 20%-40% across active distributors. This has not translated to overly negative sentiment however, with one source suggesting the UK is seeing a quiet period similar to the traditionally quieter summer months on the continent.
“In previous years the UK has kept going somewhat while the European market went on holiday, but it seems we’re back to quiet summers,” said the trader source. “July and August used to be normal-ish months, but we’re in something of a two-week shutdown while customers take extended holidays.”
A stockholder source characterized the market similarly, saying they were “cautiously optimistic” for recovery.
Regardless of sentiments on demand revival, sources were almost unanimous that prices were at least close to the bottom, with pricing floors visible in the near-term.
— Benjamin Steven