The coronavirus emergency is still raising concerns in the European market, and especially in Italy where the restrictions that were already in place in the north of the country have been extended to all of the national territory today, March 10. The situation is having a great impact on HRC demand as most buyers are in wait-and-see mode, even if they need to restock. However, local producers have issued reassurances that production and logistic activities are continuing, though with the necessary precautions.
So far the official prices have not changed significantly, also because prices of raw materials, i.e., scrap and iron ore, are still relatively high. In fact, European flat steel producers are still targeting price increases. While Italian producers are pushing for official price levels of €460-470/mt ex-works, ArcelorMittal is aiming at €500-520/mt ex-works in northern Europe. However, sources believe it will be very hard for these price levels to gain acceptance. Import offer prices are still relatively high, even though the recent weakening of the dollar against the euro is making them more competitive. Current HRC offers from Turkey are at €455-460/mt CFR, which is "not low enough", according to one trader. In any case, "no one is in the mood to buy into Italy these days", underlined the same source. Some Turkish mills report that rare bids from Italy do not exceed €430/mt CFR.
Compared to last week, domestic workable HRC prices in Italy have fallen slightly by €2.5/mt to €440-445/mt ex-works. As for northern Europe, HRC prices have trended sideways at €480-485/mt ex-works.