Although HRC prices have remained strong in the EU market this week, sentiments have been rather mixed given on the one hand local producers’ plans to further increase their offers, while on the other hand the global market is rather turbulent given the recent price drops for ex-Asia materials. At the same time, the unplanned stoppages at ArcelorMittal’s facilities in Spain and France due to recent fires are expected to tighten HRC supply in the summer months and, as a result, provide additional support for further price increases. However, bearish sentiments provoked by the recent sharp drops in China are likely to further affect the global market mood.
More specifically, domestic prices in the EU HRC market have been estimated at €850-890/mt ex-works, versus €850-870/mt ex-works last week, with the official HRC offers from Italian mills standing at €860-880/mt ex-works, up by €10/mt week on week, while the tradable price level is still estimated by some buyers at €850/mt ex-works. “Since last week, there is very great confusion in the market, as mills keep talking about their plans to increase offers to €890-900/mt, which for now seems impossible,” a market insider told SteelOrbis.
In northern Europe, the situation has been very similar, with mills offers heard at €870-890/mt ex-works, up by €10-20/mt week on week, but, according to market insiders, workable prices have been heard at around €860/mt ex-works.
“The market is just full of doubts. With decreases seen in China, nobody wants to buy at higher levels, so the situations should be clearer after Easter,” another source said.
Meanwhile, import HRC prices in southern Europe have settled at €750-800/mt CFR. While most suppliers have maintained their offers stable at high levels, some Asian suppliers have decided to go slightly lower. In particular, offers for ex-Vietnam HRC have been voiced at €750-770/mt CFR, versus €770/mt CFR last week. Meanwhile, following several deals for ex-Japan HRC at €770-780/mt CFR last week, a few small batches are reported to have been signed at the same level in Italy this week, while most ex-Japan offers have been heard at €770-790/mt CFR. Besides, suppliers from Indonesia have maintained their offers at €760-765/mt CFR, while offers from Taiwan and South Korea have settled at €770/mt CFR and €780/mt CFR, respectively, down by €10/mt on the higher end of the range week on week. At the same time, offers for ex-India materials have been voiced at mainly €760-770/mt CFR Italy and at around €770-780/mt CFR Spain, reflecting the same level as last week.
Offers for ex-Egypt HRC have been heard in Spain at around $830/mt CFR (€770/mt CFR), up by €6/mt week on week, with a few deals reported at €830/mt CFR, or around €760/mt CFR this week, according to sources. Furthermore, market insiders have reported occasional offers for ex-Turkey HRC at $870-890/mt CFR, duty paid, which translates to around €800-815/mt CFR southern Europe.
“I think the European market will face further mixed signs as mills will try to push prices up, while China and probably other Asian steel markets will likely keep on a negative trend in the coming weeks, as more and more deals for ex-Asia HRC have been reported in different parts of the world at lower levels,” a Spain based trader told SteelOrbis.
$1 = €0.92
