Despite sluggish trading, European markets for hot-rolled coil (HRC) appear to be showing signs of stability. That dynamic, according to Fastmarkets, has encouraged steel producers on the Continent to aim for higher prices in anticipation of upcoming long-term contract discussions set for mid-June.
This bullish outlook among manufacturers has been bolstered by recent regulatory changes, including the extension of EU import safeguards for two additional years and a new 15% cap on residual quotas for HRC imports from Asia. These measures are expected to reduce the influx of competitively priced Asian steel, potentially easing downward price pressures.
In specific movements, Fastmarkets reported a steel mill in the Benelux region increased its spot HRC offer by €20 to €650-660 per tonne ex-works. Conversely, another major European mill retracted its offers late last week, with indications of returning this week with elevated prices, though this has not been confirmed.
However, buyer sentiment in Northern Europe remains cautious, with slow consumption and a downtrend in raw material costs leading to doubts about the feasibility of price increases. Distributors and steel service centers are reportedly not building inventories, with the workable price level perceived to be around €620-640 per tonne ex-works.
Fastmarkets’ daily steel HRC index for Northern Europe was slightly up at €634.75 per tonne, reflecting a modest increase. Meanwhile, the index for Italy dipped slightly to €630 per tonne.
Furthermore, Asian suppliers are currently less active in the European market, awaiting further details on the new safeguard adjustments. Meanwhile, Turkey has raised its export offers for HRC to Europe by about €20 per tonne, with offers including anti-dumping duties ranging between €600-630 per tonne CFR.
These factors illustrate a cautious yet potentially upward trending market for HRC in Europe.
