The European hot rolled coil (HRC) market has started September on a sluggish note, with mills across the region slowly returning from summer stoppages but showing no urgency to resume full operations. Trading activity has remained subdued, particularly in southern Europe, where demand in Italy and Spain continues to lag. Domestic offers from mills have stayed broadly stable compared with late August though workable prices have shown a slight upward bias.
Specifically, local HRC prices from mills in northern Europe, mainly for October and November delivery, have been estimated at €580-590/mt ex-works. However, according to sources, some mills are reported to be targeting €600-630/mt ex-works for new orders. At the same time, the tradable price level has been estimated at €570-580/mt ex-works level so far, up by €10/mt week on week.
According to sources, in northern Europe, mills are maintaining their attempts to raise offer levels, but limited spot demand is capping transaction volumes. In the meantime, many buyers had already secured sufficient tonnages for the third quarter and see little immediate need to restock, which is keeping negotiations muted.
In Italy, while mills have been aiming to increase their prices for October delivery HRC to €570-580/mt ex-works, the same as last week, workable prices have been estimated at around €540/mt ex-works, up by €10/mt week on week.
Meanwhile, import activity has remained virtually frozen amid persistent uncertainty over the implementation of the Carbon Border Adjustment Mechanism (CBAM). Buyers are largely refraining from placing new orders, while indicative import HRC prices were heard in the range of €475–530/mt CFR, depending on origin. The lower end the of the range corresponds to offers for ex-Indonesia HRC, while the higher end of the range corresponds to offers for ex-Turkey HRC at €510-530/mt CFR, duty included. However, according to sources, deals for ex-Turkey HRC are unlikely in the short run as Turkey has almost exhausted its EU HRC import quota for the third quarter.
“According to the Commission’s timeline, the technical implementation acts regarding CBAM are due in the fourth quarter, with a summary of the consultations expected beforehand,” a market insider told SteelOrbis.