Libyan strife to impact southern European flat rolled market

The steel markets this week have been coming to terms with the increasing strength of the euro against the US dollar and the impact of the political turmoil in Libya, while the likely influence of the earthquake in Japan has also been a topic of discussion. The common view this week is that import price levels from non-EU countries for southern Europe may receive a positive response given the recent changes in the exchange rate. The Libyan flat rolled producer Libyan Iron and Steel Co. (LISCO), which has suspended its production operations, is known to be an exporter to southern European countries in particular. When we look at Italy's import volumes from Libya, we see that about 45,000 mt of hot rolled coils were imported from Libya in October, and these tonnage purchases are expected to shift from Libya under current circumstances to other countries and to Turkey in particular.
 
In Italy's domestic market, hot rolled coil prices from producers have maintained levels of €620/mt ex-works, while the sales prices at ports are floating at around €590/mt ex-warehouse. Import offers from Turkey are heard to be at around €575-580/mt CFR levels. In the meantime, it is reported that Ukrainian HRC offers to the Italian market stand at $700/mt FOB.
 
In the Portugese domestic market, demand does not appear so strong. The price levels of steel service centers for hot rolled sheets have regressed to €650-660/mt ex-warehouse, while the price of hot dip galvanized from Lusosider is heard to have fallen from €730/mt to €710/mt, ex-works. 
 
In Bulgaria, inventory levels are comparatively high; however, demand for flat rolled steel is better than that for long products. Stockists in the Bulgarian domestic market are quoting offers for hot rolled coils at BGN 1,100/mt ($801/mt) ex-warehouse.
 
€1 = $1,424
$1 = BGN 1,374