EUROPE HRC WRAP: Domestic prices inch up; trading slow on lack of offers
Domestic prices for hot-rolled coil in Europe increased in the week to Friday June 18, despite a trading slowdown that resulted from both buyers and sellers holding back from deals.
Only a few mills were active in the market and they only had limited volumes on offer, so buyers who needed to re-stock specific material had to accept the higher prices available, sources said.
Buyers, in the meantime, were holding back from making new deals, preferring to pause their market activity due to international price volatility, and until the European Commission released its findings in the import safeguards extension case.
EU member states voted in favor of the proposed extension of these measures on June 18, although the European Commission had not released an official statement.
On June 11, the European Commission had published a draft proposal to member states, suggesting a three-year extension to the existing safeguard measures on 26 steel products imported into the EU, with an annual quota increase of 3%.
On June 18, Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €1,152.00 ($1,366.46) per tonne, up by €15.33 per tonne week on week and by €69.50 per tonne month on month.
Friday’s index was based on market participants’ estimates of achievable prices at €1,120-1,160 per tonne ex-works and offers reported at €1,170 per tonne ex-works.
Despite the slowdown in trading last week, European producers said that they had good order books so had no intention of cutting HRC prices. Most mills in the north of the EU were only able to offer material for fourth-quarter delivery, sources said.
A mill in Slovakia, however, was able to offer limited tonnages of September-shipment material at substantially higher prices - €1,240-1,250 per tonne delivered, equivalent to €1,200-1,210 per tonne ex-works, market sources said.
Other producers in Central Europe offered HRC at €1,200-1,230 per tonne delivered to customers across Europe, sources said.
Last week, flat steel producer HBIS Group Serbia said that it planned to restart its blast furnace No1 on August 16 this year.
Fastmarkets calculated its daily steel HRC index, domestic, exw Italy, at €1,136.00 per tonne on June 18, unchanged day on day.
But the index was up by €12.67 per tonne week on week and by €70.78 per tonne month on month.
The Italian index was based on offers heard at €1,140-1,170 per tonne ex-works and estimates reported at €1,100-1,150 per tonne ex-works.
Italian mills were able to offer HRC for delivery at the end of the third quarter or early in the fourth quarter, sources said.
Interest in overseas material from European buyers was limited during the week due to global price volatility and a lack of clarity on the EU’s safeguards regime.
HRC offers from Turkish mills were heard at $1,120 per tonne cfr Southern European ports on June 17.
Indian suppliers offered HRC to Southern Europe at €1,050 per tonne, including 25% duty for exceeding the quota limit, sources said.
Producers in India have already sold substantial volumes of HRC to Europe and sources said that they were likely to exhaust their quota for July-September on the first day of the new quarter.