HRC mills in Western Europe continue to seek higher prices for hot rolled coil on high local demand and low availability, traders told MetalMiner.
End users are also trying to hedge their positions because November and December are the two months when they build up stocks before year’s end, traders said.
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Mills are now offering HRC at €600 ($715) per ton EXW for February/March delivery, up from previous deals of €520-530 ($620-630), sources said.
It’s not clear if any buyers have accepted the latest offers because they are still “swallowing this information,” one of the traders noted.
HRC from Russia, Turkey
The lack of available material on the local market is adding support to the offer prices, one trader added.
“The mills can wait,” the trader said about market acceptance, noting that even availability of imported HRC is becoming scarcer.
Russian mills are now offering $630-640 per ton FOB into Europe, up from last week’s $580, a second trader said.
Mills from Turkey are also seeking about $650/mt FOB, the trader noted. He did not know, however, if anybody has also accepted the latest offer.
While much demand for HRC in West Europe comes from European automakers, traders acknowledged that the COVID-19 pandemic has stunted demand for that sector in 2020 and into 2021.
Demand in China
Demand for HRC is also high now within Southeast Asia because China is participating in infrastructure projects for that region, traders said.
Sources also have pointed to higher raw material costs as another factor in rising West Europe HRC prices.
Benchmark 63.5% Fe iron ore on Nov. 26 was approximately $127/mt CFR Tanjin — up by more than twice from the approximately $62 recorded on the same date two years ago in 2018.
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