HRC prices stable in EU as supply remains tight

Transaction prices for hot rolled coil (HRC) have remained mostly stable in the EU market in the past week. Supply has remained tight, while demand has been slower so far in June compared to last month. This has been due in part to the cautious approach adopted by domestic distributors, who are awaiting a final decision on the safeguard measures due to expire on June 30. According to a notification sent to the WTO at the end of last week, the EU intends to extend such measures until June 30, 2024, with a three percent annual relaxation of the tariff quotas. Previously, rumors said that the safeguard would be extended for one year only and with an increase of import volumes by five percent yearly. In this situation, no fresh offers nor deals have been reported in the import market lately. Moreover, as reported previously, demand from the automotive sector has decreased recently, in part due to a lack of semiconductors globally. However, this situation has not had an impact on domestic HRC prices so far, which have also been supported by scrap price rises, some sources underlined. Accordingly, HRC prices have remained at €1,130-1,150/mt ex-works in the EU market, although at least one source reported that prices at the lowest level of €1,120/mt may be possible in the Italian market. Mills still have good book orders and deliveries are mostly for the late third quarter or the fourth quarter.