EUROPE HRC WRAP: Transaction prices up on material shortage, ArcelorMittal raises offers again
Transaction prices for domestic steel hot-rolled coil continued to rise across Europe in the week to Friday December 4, due to tight supply from both domestic and overseas suppliers.
Following a rise in deal prices, at the end of last week ArcelorMittal pushed official spot offer prices for its second-quarter rolling HRC across Europe to €650.00 ($788) per tonne ex-works with immediate effect. The traditional gap between offers in Northern and Southern Europe has now disappeared altogether.
Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €575.00 ($696.88) per tonne on December 4, up by €15.00 per tonne week on week and by €69.89 per tonne month on month.
Friday’s index was based on deals heard at €570-575 per tonne ex-works and achievable prices reported at €570-580 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel HRC, domestic, exw Southern Europe, was €550-560 per tonne on December 2, up by €10 per tonne week on week from €540-550 per tonne. This reflected achievable prices and the lower end of offers in the market, which were reported at €550-570 per tonne ex-works.
Some sources also claimed that one producer had increased its official offers to €580-600 per tonne ex-works.
The main driver behind the price rise and the bullish mood in the European market was the shortage of both domestic and imported coil, sources said.
Northern European mills have sold out of first-quarter rolling HRC and have been trading April-May shipment coil, while Italian producers have been offering March-shipment material at the earliest, Fastmarkets heard.
In addition, no competitive import offers were reported, with the availability of overseas coil reduced due to European safeguard measures and the start of registration for Turkish HRC imports, which could result in retroactive anti-dumping duties.
Additionally, prices for overseas coil have been rising and lead times have been either longer or comparable to those from European mills, market sources said.
Fastmarkets’ weekly price assessment for steel HRC, import, cfr main port Northern Europe, jumped to €570-580 per tonne on December 2, compared with €560-570 per tonne a week earlier, based on offers from Russia and Asia heard in the market.
The corresponding weekly price assessment for steel HRC, import, cfr main port Southern Europe, rose to €560-570 per tonne on Wednesday, compared with €550-570 per tonne a week earlier. Offers of HRC from India were heard at €585 per tonne cfr Italian ports.
Market participants did not expect the material shortage to end any time soon but believed it would continue into the first three months of 2021, with demand remaining strong due to low stocks.