Market participants are warning that the European market may not be ready to accept significant roll price increases following ArcelorMittal's recent price hike announcement, Kallanish reports.
Although the increase was probably caused by the entry into force of the Carbon Dioxide Emissions Control Mechanism (CBAM) from the beginning of the year, there has been a slow and gradual increase in emissions in previous months.
"But attempts by steel mills to raise prices faster are likely to be resisted by refiners, who are not yet able to take on these costs," the Dutch manager believes.
He reviewed recent offers to import hot-rolled coils from Turkey and the Middle East at prices of up to 540 euros per ton (US$633) from Antwerp. According to him, when adding the cost of CBAM, depending on the specific case, there would be practically no import problems, since until last week, HRC was sold on the domestic market at a price of 630-650 euros per ton. New ArcelorMittal offers raise the price of HRC to 700 euros per ton
.
Prices for cold-rolled and hot-dip galvanized coils have increased even more: prices for CRC are now 830 euros per ton, and for galvanized material - 820 euros per ton. The previous highest quotes were recorded in the Netherlands at 750 euros for CRC and 760 euros for HDG.
Notably, the prices offered by CRC have now surpassed HDG prices. A German columnist told Kallanish that recently domestic factories have shown less interest in CRC production, preferring HRC and HDG, as a result of which CRC is becoming more and more in demand in the market.
The Dutch manager also points to EU measures such as the ongoing anti-dumping investigation into CRC, where an increase in duties is expected in the near future. For factories, this justifies an additional premium for cold-rolled material, he notes.
One German buyer believes that ArcelorMittal is "going too far" and that the new prices for CRC and HDG, in particular, "are completely out of line with the market; perhaps this concerns some special high-quality material."
He is concerned that the new quotes will scare away buyers who will become even more restrained. "Many people will postpone their orders, and inaction always has a bad effect on the market," he adds.
Author: Christian Kel
Kallanish.com
