Business activity in the flats market in Romania has been weak recently due to aggressive price moves in the scrap segment, weak demand, and local economic issues which are putting pressure on domestic price levels, particularly prices from the sole domestic producer. Local traders, who are sitting on high stocks, have also been flexible in their local prices for sheets. Moreover, some of them, being in relatively urgent need to destock, have reportedly been ready to offer at rather aggressive levels. In the meantime, flats imports in Romania have been slow lately, once again due to local buyers being unwilling to restock amid low demand from end-users.
In the local market, Romania has only one flats producer which sells its materials in coils, while in the retail segment traders normally trade steel in sheets. Prices for domestic July production hot rolled coil (HRC) are reported at €820-825/mt ex-works, down from €850/mt ex-works last week. Furthermore, on the hot rolled sheet (HRS) side, most traders announced rather aggressive levels of €925-1,025/mt ex-warehouse, while other sellers have been offering much higher levels of around €1,025-1,255/mt ex-warehouse. The upper end of the range is not considered workable in the market, although some purchasers buy from these ranges due to quality or loyalty.
“Aside from low market demand, a lack of exports and declining scrap prices, there is bitter competition in the market right now. The retail flat market is difficult to evaluate since traders want liquidity, and so the Romanian market is prone to price wars between traders and stockists. With this in perspective, we foresee uncertain market pricing in the coming weeks since there are too many flat products in traders' and stockists' warehouses, and we will see some lower and higher prices outside of the regular ranges of flat steel," a seller told SteelOrbis.
Since flats stocks are high in Romania and therefore there is no immediate need for imports, there are few firm import offerings. Instead, some local suppliers have been trying to activate exports, trying to minimize stocks. A few exports to Bulgaria from Romania for HRS and CRS have been reported at around €1,020/mt and €1,180/mt respectively, both on DAP Rouse basis.
On the other hand, the local producer’s cold rolled coil (CRC) prices for July are reported at around €900-905/mt ex-works, down €25-30/mt from the previous week. In addition to this, traders’ cold rolled sheet prices (CRS) are the same as the hot rolled sheet (HRS) prices this week and also same situation is seen for CRS: some of the traders are trying to sell higher at €1,025-1,345/mt ex-warehouse, which is also not workable in this market. Also, the domestic producer’s price for HDG is at around €1,000-1,005/mt ex-works.