EUROPE HRC WRAP: Prices largely flat in seasonally slow market; outlook uncertain

Domestic prices for hot-rolled coil in Northern Europe and Italy were broadly unchanged during the week to Friday August 20 amid low trading activity during the summer holiday slowdown.

Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe at €1,142.50 ($1,336.45) per tonne on Friday, down by €0.63 per tonne day on day from €1,143.13 per tonne.

The index was up by €2.50 per tonne week on week and down by €21.50 per tonne month on month.

Friday’s index was based on achievable prices indicated 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 €1,018.33 per tonne on Friday, unchanged day on day.

The index was up by €7.08 per tonne week on week, but down by €66.67 per tonne month on month. It was based on offers and achievable prices heard at €1,000-1,050 per tonne ex-works.

Trading activity across Europe remained quiet during the past week, which is typical for this time of the year. Fresh offers are expected closer to September.

The majority of European steel mills and buyers held back from the markets, trying to assess the post-summer trend.

The latest offers for HRC from India and Turkey were heard last week at €880-930 per tonne cfr Italian ports, including anti-dumping and export duties where applicable.

Sources said that although the available volumes have been limited, they have still had an impact on sentiment, sources said.

Expectations among European buyers and mills regarding the future price trend of HRC diverged, Fastmarkets noted.

Buyers largely expect prices of HRC to correct downwards in September due to the downtrend in the global market, falling feedstock prices and competitive import offers. In addition, most large distributors in Europe have sufficient HRC stocks and are not looking for urgent purchases.

But producers have good order books, with some claiming to be sold out until the end of the year. According to mills, sharp prices drops are unlikely.

Availability of HRC in the domestic market during the fourth quarter is expected to increase, however, with some large steelmakers restarting idled equipment.

During the week to August 20, German industrial group Thyssenkrupp resumed steelmaking operations at its largest mill in Duisburg after a scheduled maintenance.

The week prior, Salzgitter, another German steelmaker, announced plans to resume operations at its 600,000-tpy ‘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.

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