European hot rolled coil (HRC) market conditions have remained largely unchanged over the past week, with mills in the north reporting solid order books for near-term deliveries and limited availability for February shipments. At the same time, producers have continued to aim for higher prices for March and April and second quarter deliveries, citing limited availability. At the same time, activity in the import segment has stayed muted, with buyers maintaining a wait-and-see approach amid uncertainty over demand and CBAM-related considerations. However, market sources have reported talk regarding a discounted deal for ex-India HRC this week.
More specifically, offers from mills in northern Europe have been voiced not higher than €650/mt ex-works for February delivery, mainly the same as last week. According to sources, mills are widely reported to be close to sold out for February delivery. At the same time, while a deal for March shipment HRC has been reported in Germany at €650/mt ex-works, the tradable price level has been estimated at €630-640/mt ex-works.
“For March-April delivery, mills are targeting higher prices of €650-670/mt ex-works, while some suppliers price ideas for Q2 deliveries are even stronger, at approximately €680-700/mt ex-works,” a market insider told SteelOrbis.
Meanwhile, indicative prices from Italian mills have been estimated at €630-650/mt ex-works for February and March delivery, versus €620-640/mt ex-works for February delivery last week. However, workable local HRC prices in Italy have been assessed at €620-640/mt ex-works, up by €10/mt week on week. Despite the slight increase, trade activity has remained extremely slow.
In the meantime, business activity in the import segment have remained slow, with the indicative prices are estimated at €490-565/mt CFR, the same as last week, while HRC import offers including CBAM costs on DDP basis have remained at €610-620/mt levels, depending on the supplier.
Import offers on CFR basis, excluding CBAM-related costs, have remained scarce in the region this week, with most suppliers providing only indicative numbers. In particular, ex-India HRC offers have been voiced at $570-575/mt CFR, which translates to around €490-493/mt CFR, the same as two weeks ago. However, according to sources, talk about a deal for around 30,000 mt of ex-India HRC signed at $560/mt CFR or €480/mt CFR for March shipment and the second quarter period has been circulating in the market.
Offers for both ex-Algeria HRC and ex-Taiwan HRC have been voiced in southern Europe at $630/mt CFR, which translates to €542/mt CFR. Besides, offers for ex-Saudi Arabia HRC have been reported at €530/mt CFR, though some sources have also reported lower offers at around €510/mt CFR. According to sources, Saudi Arabia’s only flat steel producer may be looking to export HRC to Europe, aided by a CO₂ surcharge advantage for many blast furnace-based Asian suppliers. According to SteelOrbis’ calculations, CBAM costs for ex-Saudi Arabia HRC default values are at around €160/mt and at around €47/mt for verified values, with the CBAM certificate price at €92/tCO2e as of January 15.
Offers for ex-Turkey HRC on DDP basis, including CBAM, through traders have been voiced at €615/mt DDP, while offers for ex-Asia origin HRC have been voiced at €610-620/mt DDP through traders, the same as last week.
$1 = €0.86