Although end-user demand has remained subdued, the uptrend of hot rolled coil (HRC) prices in Europe has continued this week as most European producers have been more positive in terms of the future price trend, supported by reduced supply amid production cuts, higher restocking reported in the region, and minimal interest in import offers due to longer lead times, while new import prices have also increased this week.
Accordingly, compared to last week, HRC offer prices from EU mills have increased by at least €10-20/mt to €650-680/mt ex-works. In particular, while official offers from mills in northern Europe have been voiced at €680/mt ex-works, the workable price level has been estimated at €640-660/mt ex-works for January delivery, with several deals reported at the abovementioned level. Besides, according to sources, mills have been aiming for increases to up to €700/mt ex-works for the first quarter of next year.
Meanwhile, most big mills in Italy have been refraining from giving firm offers, though the indicative HRC prices from mills have been estimated at €650-660/mt ex-works, up by €10-15/mt week on week, while the tradable level has increased to €620-625/mt ex-works, up by €20-25/mt week on week. “As well as in the north, we heard mills plan to increase their HRC prices to €680/mt ex-works. However, the sustainability of a such sharp rise is still doubtful,” a market insider told SteelOrbis.
“Trade activity in the spot market in the EU is still weak, but mills have started negotiations with the automotive sector for orders in the first quarter of next year,” another source said.
At the same time, most import HRC offers have increased this week as well, reaching €610-620/mt CFR, up by $10-20/mt week on week, for mainly ex-Asia HRC for January shipment, or delivery in February or March. Furthermore, several offers for ex-India HRC have been voiced at as high as €640/mt CFR, while suppliers from Turkey are reported to be offering their materials for December shipment at €640-650/mt CFR, including duty. “We have still heard bids at €590-600/mt CFR level in Italy for ex-Asia HRC, which means buyers are not ready for import hikes so far. Though if local suppliers remain as bullish as they claim they are now, more interest in imports will be seen,” a Spanish trader told SteelOrbis.
