While a few Italian flat steel producers have never completely stopped producing, the Italian market remained in standby mode for the most part of March and April, i.e., after the implementation of the lockdown measures imposed by the government to tackle the coronavirus. More and more steel companies have resumed operations in the past two weeks by presenting requests to the regional prefects for derogations from the government restrictions, albeit with reduced operations and a lower number of workers than normal. However, sources have underlined that so far both steelmakers and distributors have been handling the orders they had already received before the lockdown. They hope for a relaxation of the restrictive measures from May 4, as this would allow for an increase in end-user consumption.
In this context, local hot rolled coil (HRC) prices in Italy have decreased by €5/mt compared to early April to €435/mt ex-works. Meanwhile, SteelOrbis has learned of import offers at €395-405/mt CFR Italy depending on the source, for June shipment. However, the interest in imports is low as demand is weak. Meanwhile, HRC prices in northern Europe have decreased from €460-465/mt to the level of €450-460/mt, both ex-works. The HRC market relies heavily on the automotive sector, and lots of producers are just starting to resume operations. However, according to market sources, it is unlikely that car production rates will go back soon to pre-coronavirus levels.