HRC prices increase in northern Europe

Tuesday, 30 June 2020 17:51:35 (GMT+3)   |   Brescia
       

Squeezed between increasing raw material prices in the past months and slower finished steel sales, European flat steel producers have seen their margins decrease, and this is why they have been trying to increase their sale prices in the past few weeks. However, distributors and service centers still have sufficient stocks generally, SteelOrbis sources underlined. Although end-user demand has started to improve slowly after the easing of lockdown restrictions throughout Europe, several sectors have continued to suffer, especially flat steel-related sectors such as automotive and home appliances. As reported previously, European steelmakers increased their offers by €20-40/mt early last week to €440/mt ex-works for hot rolled coils (HRC) in northern Europe. Several sources have expressed doubts about the success of such a move, while others have said that buyers may have to accept these price increases at least partially due to the lack of competitive import offers and also because producers have reduced their outputs. However, it is unlikely that the price recovery will be significant due to poor demand. Currently, workable prices for HRC are mostly at €385-405/mt ex-works in northern Europe, up €5/mt on average compared to one week ago, while they are at €370-380/mt ex-works in the Italian market, i.e., stable in the past week. Sources are still uncertain about how much traction producers' increases will get. As already mentioned, buyers may have to restock in the coming months and in particular for September, which could help producers obtain higher prices. Meanwhile, the EU regulation which amends the safeguard measures on steel imports have been republished today, June 30. These are going to impact particularly HRC imports from countries such as Turkey, India and Serbia.


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