EUROPE HRC WRAP: Prices down on low trading activity; outlook mixed

Domestic prices for hot-rolled coil declined in Northern Europe and Italy in the week ended Friday August 13 due to low demand during the summer holiday slowdown.

Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €1,140.00 ($1,344.51) per tonne on August 13, down by €10.83 per tonne week on week and by €24.00 per tonne month on month.

The index was based on achievable prices estimated by market sources at €1,130-1,150 per tonne ex-works.

Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Italy, at €1,011.25 per tonne on Friday, down by €35.42 per tonne week on week and by €101.25 per tonne month on month.

The index was based on achievable prices and deals heard at €980-1,040 per tonne ex-works.

The majority of EU steelmakers and buyers have been holding back from trading so far during August, following the traditional cycle of market activity. This was expected to start to recover at the beginning of September.

Market participants had a mixed outlook on the market situation in September.

Some believed that, despite the effects of safeguards and anti-dumping measures, and the high levels of buyers’ stocks, lower import offers would not support trading activity. Domestic coil prices might, therefore, soften slightly.

The latest import offers of HRC from Turkey and Russia to the south of Europe were reported at about €920 per tonne cfr.

India-origin material was available at an even lower price - about €860 per tonne cfr.

In addition, domestic material availability was likely to increase after the restart of mill equipment, sources said.

German steelmakers Salzgitter unveiled plans to restart its ‘C’ blast furnace in November this year. The decision was based on the company’s forecast that demand for flat steel will remain stable at a high level in Europe.

The furnace has been idle since autumn 2019. Blast furnace C has capacity for 600,000 tonnes per year of pig iron.

On August 6, Germany’s Thyssenkrupp ended the force majeure at its Steel Europe division. It had declared force majeure on July 16 because it was not able to ship feedstock steel products between the company’s sites due to severe floods in Germany.

Other market participants said that European mills were unlikely to cut prices given that some of them were already sold out until the end of the year. Others were only able to offer fourth-quarter rolling HRC.

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