Foreign hot rolled coil (HRC) suppliers have continued to cut prices for southern European buyers, including Spanish buyers, this week. However, trading activity has remained low, with buyers still signing only occasional bookings amid the continuous lack of demand for HRC and the ongoing decline of local prices. Most Spanish customers expect import prices to hit bottom in the near term amid the imposition of new Indian duties, though a rebound in flat steel prices could be affected by potential natural gas stoppages from Russia and general inflation in the EU region.
Accordingly, this week most HRC suppliers have decreased their offers for Spanish importers. More specifically, offers from Japan have declined to around €870-890/mt CFR, compared to €920-930/mt CFR last week. Suppliers from South Korea and Taiwan have decreased their HRC offers by €20-30/mt week on week to €860-870/mt CFR Spain, while ex-South Korea HRC offers to Italy have been heard at already €840/mt CFR, down by €50/mt week on week. Meanwhile, offers from Turkey have been reported at around €900/mt CFR, down by €20-30/mt over the past week, though, “Turkish mills are not offering directly, asking for firm bids,” according to a source.
At the same time, most Indian mills are said to have suspended negotiations following the recent introduction of export duties. The indicative offers for ex-India coils have been settled at €900/mt CFR, compared to €900-930/mt CFR last week. “There are almost no new offers heard from India, but we heard that India is trying with boron-alloy material to avoid paying export duties,” a market insider told.
In addition, no HRC offers have been heard from Chinese suppliers this week. “Spanish customers are not so much interested in buying ex-China materials as they have enough coils in stock and quick deliveries from Europe and prefer not to take risks,” a Spain-based trader stated.
“Some foreign traders are informing the customers that maybe with a firm bid they can obtain €850/mt CFR and lower, but the truth is that customers are not in need of buying and are in a wait-and-see mood,” another source told SteelOrbis.
Meanwhile, local HRC prices in Spain have been settled at around €990/mt ex-works, compared to €1,000-1,100/mt CFR last week.