EUROPE HRC WRAP: Price fall further in the north

Domestic prices for hot-rolled coil fell further in Northern Europe in the week to Friday June 19 due to low market demand.

Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Northern Europe, was €390.00 ($435.86) per tonne on Friday, down by €6.25 per tonne week on week and down by €19.84 per tonne month on month.

The region’s integrated mills have been offering HRC at €400-410 per tonne ex-works, but producers were ready to trade at €385-395 per tonne ex-works, sources said.

Bids for material have been heard at €380-390 per tonne ex-works.

HRC produced by re-rollers, meanwhile, was available at the equivalent of €370-380 per tonne ex-works, according to market participants.

Fastmarkets’ weekly assessment of the price for steel HRC, domestic, exw Southern Europe, was unchanged week on week at €370-380 per tonne.

Official offers for HRC in Italy were heard around €370-380 per tonne ex-works, while prices in Spain were reported at €380-405 per tonne ex-works.

Some market sources said that major buyers could acquire a significant volume of HRC from Italian mills at €355-365 per tonne ex-works, but because this would significantly exceed the average lot size of spot deals, the price was not reflected in the assessment.

Demand has been slow due to high stocks at distributors and poor buying interest among end-consumers.

Although trading activity has been low, rumors have been circulating about European mills increasing their offer prices in an attempt to bring some stability to the market, with sources saying that some mills had already achieved higher prices on a range of flat-steel products.

The mills were expected to announce price increases of €5-20 per tonne, they added.

“The European mills will definitely try to stabilize [HRC] prices by announcing small rises,” a German source said. “But the market is unpredictable. Safeguard measures will support domestic prices, [and the] automotive [sector] is showing some signs of slow recovery, but European mills will most likely have to introduce further production cuts to achieve a price increase.”

Earlier this month, the majority of European member states voted to approve proposed amendments to the current safeguard measures for imports of steel.

Reviewed measures will come into force after June 30 this year and include, among other changes, replacement of the current global quarterly quotas for imported HRC with country-specific quarterly quotas for countries that exceeded 5% of total material deliveries in the reference period of 2015-17. This means that Turkey, Russia, Serbia, India and South Korea will get their own quota volumes, while other suppliers will be subject to a residual global quota.

Pig iron production at Tata Steel IJmuiden in the Netherlands was stopped on June 19 when the plant’s workers went on a 24-hour strike.

The iron ore supply to two of IJmuiden’s blast furnaces (BF) was completely stopped, sources close to trade unions said.

But Tata Steel said that one BF was stopped for a short planned maintenance outage, while another BF was taken offline due to the strike.

Slovakian flat steel producer US Steel Kosice has restarted its BF No1 and a hot-strip mill, which were idled in late May for maintenance.

In the second half of May, the subsidiary of US Steel idled BF No1 to adjust its output because of maintenance at the hot-strip mill, which was originally scheduled for the third quarter of 2020. The outage was rescheduled to May because of the dramatic decline in demand created by the Covid-19 pandemic.

And ArcelorMittal Fos-sur-Mer in France decided not to idle BF No2 after a strike on June 16, market sources said.


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