While business operations in the European hot rolled coil (HRC) market have been slow, the leading regional producer has decided to push its domestic prices for May deliveries across the EU up by €20/mt. Moreover, some sources do not exclude a further hike to be seen in the short run. The workable HRC prices have also slightly increased in Europe, although remaining lower than the mills’ official targets. In the import segment, most foreign suppliers have maintained their offers to the EU, with only a few occasional offers heard at slightly lower levels.
In the local EU market, steel producer ArcelorMittal has increased its coil offers by €20/mt across Europe this week, though market insiders doubt the sustainability of a further uptrend given the slack demand in the region. According to sources, the company’s HRC offers for May delivery have settled at €820/mt, versus €800/mt announced last month. Furthermore, the producer’s offers for CRC and HDG have also increased by €20/mt, to €920/mt and €940/mt, respectively.
As a result, official HRC offers from European steel mills, both in northern and southern Europe, have increased to €770-780/mt ex-works, and some to €800/mt ex-works, up by €10-20/mt week on week. The tradable values have also moved up, to €760-770/mt ex-works in Italy, versus €740-750/mt ex-works last week, although, according to some sources, €750/mt ex-works may still be workable in Italy. In northern Europe, most mills have reported full HRC order books for April deliveries, and, according to sources, the tradable HRC prices have been estimated at €765/mt ex-works, compared to €750-760/mt ex-works last week.
It is notable that market insiders have reacted differently to ArcelorMittal’s latest price increase. In particular, while some sources expect other European producers to follow suit, other are more sceptical towards the sustainability of a further uptrend as the demand recovery in the region remains slower than expected. “There is a rumour that ArcelorMittal plans to increase its HRC prices eventually up to €900/mt delivered across Europe in the coming weeks, but, even if this happens, nobody believes this level will be fixed in deals, as even deal prices at above €800/mt are too high to be true so far,” a Spanish trader told SteelOrbis.
In the import segment, the most active in offering have remained suppliers from Asia, though they have failed to succeed in concluding big sales to the region. According to market insiders, suppliers from South Korea, Japan and Taiwan have reduced their offers on dollar basis to compensate for the exchange rate that moved from 1.10 to 1.07, while maintaining the same euro price[JF1] .” In particular, offers for ex-South Korea and Taiwan have been voiced at €750/mt CFR southern Europe, the same as last week, while offers for ex-Japan HRC have settled at €750-770/mt CFR.
Meanwhile, offers from India have been heard at €735-745/mt CFR Spain, with a few deals reported at these levels. According to some sources, lower offers for ex-India HRC have been reported in Italy at €725/mt CFR, though “for only limited tonnages.”