The situation has remained broadly stable in the European HRC market in the past week. Although trading activities have remained limited, local mills have been trying to sustain their offers at high levels. Meanwhile, this week brought some unexpected news about production cuts in France and Germany, which are likely to support price stabilization and even to result in price growth in the region if demand picks up. As for the import segment, the number of import offers has been limited, with most offers heard at the same level as last week.
More specifically, Italian HRC producers’ offers are mostly at €660-680/mt ex-works, the same as last week, while the tradable level has been still estimated at €650/mt ex-works and slightly below. Meanwhile, producers in Northern Europe have been offering their materials at around €700/mt ex-works for mainly September deliveries. Still, levels at €660-680/mt ex-works are considered as more realistic and achievable.
At the same time, market insiders have been actively discussing production disruptions in Germany and France, announced on Monday, June 26. In particular, German steelmaker Salzgitter officially announced force majeure on steel deliveries caused by disruptions due to heavy rains and floods in the country. Besides, ArcelorMittal’s French unit suspended steelmaking operations at Fos-sur-Mer site due to high emissions threatening workers' safety.
“There is still a message of possible increase for local HRC, but they [European mills] are hungry for orders and will not lose an order for €10/mt,” a market insider told SteelOrbis. “Production cuts, however, is a good reason to prevent further price drops, but it will hardly help the prices’ recovery given the current slow demand,” he added.
As for the import market, there has been a very low number of offers reported in the market this week. At the same time, most offers to southern Europe have been reported at €610-630/mt CFR, depending on the supplier, compared to €610-620/mt CFR last week. However, according to sources, lower offers at around €600/mt CFR have been still heard in the market, for ex-Vietnam HRC in particular. “Most ex-Asia HRC is at €610/mt CFR this week, while offers for ex-India and ex-Taiwan are standing at $670/mt CFR or €612/mt CFR Spain,” a local trader said. At the same time, offers for ex-South Korea HRC, from POSCO in particular, have been reported at $690/mt CFR Spain, or around €630/mt CFR, up by €10/mt week on week.
Apart from Asia, market insiders have reported ex-Egypt HRC offers at $675/mt CFR, which translates to around €617/mt CFR.
Furthermore, import offers for ex-Asia HRC in northern Europe have been heard at €620-630/mt CFR, up by €10/mt from the higher end of range week on week.
$1 = €0.91