Prices for hot rolled coil in Western Europe have started to slow on subdued demand, due to the summer season and competitive import offers, market participants told MetalMiner.
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Hot rolled coil prices slow
The flat rolled product has transacted in the past week at closer to €1,200 ($1,415) per metric ton exw for November delivery. That compares with a price range of €1,150-1,200 in late June, sources said.
Producers sought to push HRC prices up to €1,250 ($1,475), one trading source told MetalMiner. End users, however, did not accept the increase.
Severe flooding late last week in the Netherlands, Belgium and Germany’s North Rhine-Westphalia state, however, have created logistics disruptions in those areas. This prompted ThyssenKrupp Steel to declare on Friday a force majeure on its deliveries, a spokeswoman for the German group told MetalMiner.
“That doesn’t help the supply for sure” as it could tighten the market and mitigate any price declines, the analyst warned.
Higher temperatures in the European summer as well as workers and businesses taking holidays in July and August, resulting in lower activity, are now putting pressure on prices for the flat rolled products.
The import market is also adding pressure to local prices, however, sources noted.
Offers on HRC from mills in Japan, Indonesia and Taiwan are about $1,170-1,200 per ton CFR European ports for September/October delivery.
“I think that it is fair to say that import activity will pick up,” one analyst said.
Lead times on the domestic market are in some cases as far out as Q1 of 2022, he added.
Uncertainty over imports
The analyst warned, however, that it is for now uncertain what kind of impact Russia’s planned introduction of a 15% export tax from Aug. 1 on all steel products – semis and finished – would have on import markets into Europe.
China is also weighing the introduction of an export tax on its steel exports in order to cool its domestic market, one source said, after canceling in May the export rebate on the 13% value-added tax failed to bring the desired effect, sources noted.
Meanwhile, the European Commission, the European Union’s executive arm, opened up an antidumping investigation in June on hot dipped galvanized coil imports from Russia and Turkey. That prompted producers in those two countries to increase offer volumes, the trader said.
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