Spain’s hot rolled coil (HRC) import market has been mainly in a lull this week considering the reduction of steel production in the country affected by soaring electricity prices following the Russian invasion of Ukraine. Most Spanish buyers have been resisting higher import prices, questioning the sustainability of the uptrend.
Accordingly, by the end of the week, several HRC suppliers have again attempted to increase their prices for Spanish buyers. More specifically, ex-South Korea offers have risen to €1,280/mt CFR Spain from €1,250/mt CFR at the start of the week, while ex-Egypt offers have increased to around €1,320/mt CFR, up by €20/mt since Monday. Suppliers from Vietnam have been offering HRC at €1,275/mt CFR, while HRC offers from Indonesia have been heard at €1,250/mt CFR. Offers from India have been reported at around €1,265-1,275/mt CFR Spain this week. Suppliers from Japan offered their materials at €1,200/mt CFR at the beginning of the week, but according to the Spanish buyers Japan has stopped offering and the market expects them to come back with new offers at above €1,280/mt CFR. Meanwhile, Turkey’s HRC offers are higher than the average, being at €1,410-1,450/mt CFR Spain, duty paid.
Furthermore, ex-China HRC offers have been voiced at around €1,040-1,050/mt CFR, being the most attractive in the market. However, European buyers are not interested in ex-China HRC, considering the AD and CVD rates within the range of 18.1-35.9 percent.
Meanwhile, local HRC prices in Spain have been voiced at around €1,400-1,450/mt ex-works on average. However, even though import HRC prices are more attractive compared to the local prices, most buyers have been refraining from making new deals. “Electricity costs have skyrocketed along with gas costs following the Russian invasion of Ukraine which is a headache for energy-intensive industries such as steel, as producers cannot pass on all of the increased costs to their customers. Besides, most steel manufacturers are reducing their production, for example ArcelorMittal which has stopped operating during peak hours,” a market insider told SteelOrbis.
