Hot rolled coil (HRC) prices have slipped further in the Italian domestic market due to the news of many customers closing in the past week, among which several carmakers, due to the coronavirus emergency. Also, sources have told SteelOrbis that at least two Italian pipe makers, Profiltubi and Tecnotubi, are about to shut down temporarily, while another pipe maker, AlessioTubi, is reducing its output. Domestic workable HRC prices in Italy are now at around €440/mt ex-works, down €2.5/mt compared to last week. Meanwhile, ArcelorMittal Italia has confirmed it will cut production, which will result in the presence of less than 50 percent of workers at its Taranto-based plant. Also, market sources are reporting that local flat steel suppliers Arvedi and Marcegaglia are reducing production, even though in the past two weeks they had said there were no critical issues arising from the emergency situation, and that their plants were fully operational. Specifically, Arvedi will not produce during weekends, and so it will be working five days instead of seven.
Actually, the problem of more and more customers shutting down has added to the problems and delays concerning deliveries, especially outside of Italy after several EU countries announced the sealing of their borders over the coronavirus pandemic. The news of major European carmakers shutting down their sites has hit HRC prices in northern Europe, which have decreased by €10/mt in the past week to €470-475/mt ex-works. European mills are said to be reducing their volumes too due to weaker sales. In this context, lead times are predicted to shorten, which will have an impact on the interest in import offers. Offers from Turkey were at €455-460/mt CFR Italy last week, but Italian bids are lower and sources expect ex-Turkey HRC offers to fall by around €15/mt for May production.