European HRC prices fall as auto sales slump
Lower auto sales in Europe have put West European hot rolled coil prices under pressure. However, demand from construction is nonetheless helping to support prices for the flat-rolled product.
“People want to invest their money into something,” one trader source told MetalMiner.
We’re offering timely emails with exclusive analyst commentary and some best practice advice.
Hot rolled coil prices slide
ArcelorMittal had originally sought €1,080 ($1,210) in November. While that price remains the Luxembourg group’s official one, transactions have taken place at lower levels.
Large-volume transactions have occurred in November at €980-1,000 ($1,095-1,120) per metric ton exw for delivery in January, the trader said.
Transactions for smaller volumes €1,050 ($1,175), the trader added.
Imports from Russia and Turkey have transacted at an average of about €865 ($970) per ton cfr Europe, the trader noted.
Auto registrations slow
New automobile registrations in the European Union totaled 665,000 units for October. That marked a drop of more than 30% year over year from 950,000 units, the European Automobile Manufacturers Association (ACEA) said Nov. 18.
That decline marks the fourth consecutive one since July, ACEA data indicated. In fact, the previous four months saw auto registrations drop by an average total of 24% compared with the same time in 2020.
Many auto manufacturers had canceled orders for semiconductors in 2020, believing that demand for vehicles would sharply decline as a result of the coronavirus pandemic.
A sharp rise in purchases of new computers and entertainment media, including televisions and gaming consoles, along with many telecoms and data providers working to provide service in the face of increased demand, also created the shortage.
The electronics sector also normally has priority over the auto sector, as the latter has been in the business for a relatively short time.
In addition, quarantine measures in parts of Southeast Asia also meant semiconductor producers there faced operating restrictions.
Ups and downs
Germany’s Federal Statistical Office (Destatis), in contrast, reported Nov. 15 that housing permits for September rose 3.9% month over month to 30,952.
Destatis also reported an 8.5% rise year over year in turnover for the month of August.
The trader believed that prices would see more fluctuation as producers in third countries would try to move their own material and then stop.
“I think that we are going to go into some waves where prices will go up and down,” the source added.
Do you know the five best practices of sourcing metals, including steel?
Leave a Reply