According to market sources, ArcelorMittal Europe has made a significant increase to its local hot rolled coil (HRC) prices, a more sizable one than was expected earlier. The new levels, discussed in the market, are €470/mt ex-works in Italy and €500/mt ex-works for the northern EU. Early in August the offers were standing at €420/mt and €440-450/mt, respectively, both on the ex-works basis.
The price increase is considered to be a more sizable one compared to the market expectations and taking into account the moderate pace of the demand revival for HRC in Europe. If accepted, higher local offers might open some doors for the imports from Turkey, while Asian sellers are expected to still concentrate on their regional sales. Current HRC export offers from Turkey are at $500-520/mt FOB base, some discounts might be applicable. “Interesting to see if others [EU mills] will follow at the same levels as ArcelorMittal,” a trader told SteelOrbis.
Some market players believe the real offers and workable levels in the market are lower, though also increased. Some offers in Germany for HRC have been reported at €480/mt FCA for September deliveries. In the meantime, some HRC suppliers to the EU market state that the demand in Italy has been livelier compared to the north. As SteelOrbis reported earlier, Russia’s Severstal has been in the market with $485/mt FOB Baltic Sea (+$10-15/mt over the week), but with the upward development in the EU pricing, the seller might revise its offers further up. Severstal’s material is available for October production.
