European domestic hot rolled coil (HRC) prices have been largely stable in the past week but have begun to show signs of weakness, as market participants pointed to currency fluctuations and geopolitical tensions as factors reshaping trade flows and buyers’ sentiments. Some believe the recent upward trend has come to an end, with potential price declines looming on the horizon.
More specifically, local HRC prices from mills in northern Europe for June and July deliveries have been reported at €670-700/mt ex-works, the same as last week. However, in Italy most offers from mills have been estimated at not higher than €650/mt ex-works, compared to €650-670/mt ex-works last week.
Meanwhile, the tradable price levels both in the north and Italy have been moving sideways, staying at €640-650/mt ex-works in northern Europe, and at €620-630/mt ex-works in Italy. “We already heard this week that in Italy local HRC has been offered at €605/mt ex-works. They say it is some exception, but still it’s not a very good sign for the market,” a market insider told SteelOrbis.
“The problem is that, with the euro at 1.14 against the US dollar, local prices are too high, and customers are pushing mills amid more competitive import offers. I believe the price increase is over, and some declines may be just around the corner,” another source told SteelOrbis, adding, “Mills need to adjust their prices, as the gap compared to import offers becomes too large when customers convert the costs.”
In the import segment, most offers in southern Europe have remained relatively stable, though some downward bias has been seen due to currency fluctuations, with prices ranging at €545-600/mt CFR, depending on the supplier, against €560-610/mt CFR last week. In particular, the most competitive offers have been voiced for ex-Indonesia HRC at around €550/mt CFR, down by €10/mt week on week, though, according to sources, €540/mt CFR “could be negotiable”.
Offers from one of the largest Indian mills have been voiced at $640-645/mt CFR, which translates to around €563-567/mt CFR, the same on dollar basis as last week, but down by around €20/mt on euro basis over the past week. Besides, according to sources, another Indian mill has been trying to book orders at around $620/mt CFR, which translates to around €545/mt CFR.
Furthermore, according to market insiders, this week deal prices for ex-Turkey HRC have settled at €580-600/mt CFR, including duty, depending on the supplier and extras.
$1 = €0.88