Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €496.67 ($588.80) per tonne on Friday, up by €0.84 per tonne week on week and by €9.06 per tonne month on month.
Friday’s index was based on achievable prices heard at €490-510 per tonne ex-works.
Some of the region’s steelmakers have been offering HRC at €530 per tonne, but this range was not included in the index because no deals were confirmed at that price.
Buyers expected that Northern European steelmakers would make an attempt to increase spot-market offer prices soon. ArcelorMittal has already increased its long-term contract prices to €550 per tonne ex-works, a rise of about €80 per tonne.
Fastmarkets’ weekly price assessment for steel HRC, domestic, exw Southern Europe, was unchanged over the week at €480-490 per tonne on October 21.
The assessment was based on deals and achievable prices heard in the market. Official offers, however, have been reported at €480-500 per tonne ex-works.
Domestic prices have been supported by good order books. In Northern Europe, producers have sold out of December-rolling HRC and have started trading first-quarter-production material. In Southern Europe, Italian integrated mills have also finished trading December-rolling HRC, and only re-rollers were reported to have some coil volumes available from production in the last month of the year.
In addition, distributors across Europe have been reported by market sources to have lower stocks than usual for this time of the year due to tight availability in the market.
Although reduced stocks support demand, some sources questioned the sustainability of the price recovery and demand from end-consumers.
Reduced availability of material in the market was caused by the fact that restarts at blast furnaces after Covid-19 lockdowns have not resulted in increased supplies of coil, market sources said.
Equipment relaunched in September has not started to operate at normal capacity yet, and any additional volumes were redirected to long-term buyers, mainly in the automotive sector, instead of the spot market, according to market participants.
Market sources claimed that demand from car manufacturers has been strong over the past month partly due to a backlog of demand resulting from low activity during lockdown, and partly to a faster business recovery from the effects of the Covid-19 pandemic.
Import offers have been limited, and buyers have been cautious about making deals for Turkish HRC due to an anti-dumping investigation undertaken by the European Commission. In addition, overseas suppliers have been unable to offer swifter delivery than domestic mills.
Fastmarkets’ weekly price assessment for steel HRC, import, cfr main port Northern Europe, was unchanged over the week at €470-480 per tonne on October 21, reflecting achievable prices heard in the market.
And the price assessment for steel HRC, import, cfr main port Southern Europe, was €460-470 per tonne on Wednesday, down by €10 per tonne week on week from €470-480 per tonne.
The assessment reflected the lower end of offers for material from Turkey and India heard in the market at €460-480 per tonne cfr Italian ports.
Sign up here for Fastmarkets’ free webinar on November 4, 2020, beginning at 9am GMT: European flat steel market – on the mend after the Covid-19 fallout?
– Overview of EU flat steel price developments in 2020 so far
– Suppliers’ response to the drop in demand
– Fortress Europe? Toughening of trade defense measures
– The survival of European steelmakers facing high raw material costs
– Demand contraction and a slow path to recovery
– Near-term price outlook.
