European prices for hot-rolled steel declined on Tuesday, May 5, due to sluggish demand and a comfortable level of inventory from buyers – and with summer approaching, few in the industry see a realistic path to a significant price recovery in the short term, sources in Fastmarkets said.
In Northern Europe, buyer sources estimate achievable prices at 680-700 euros (796-820 dollars) per ton for June-July delivery, while lower prices, they say, were offered by refiners in the Benelux region.
According to sources, German factories did not have rolls for delivery in June, but attempts to consolidate offers at a price of 730-750 euros per tonne delivered (715-735 euros per tonne from the factory) for July deliveries have so far been unsuccessful.
"There is no chance of a price increase in the summer, when demand usually decreases," said a source at a steel service center in Germany. "Besides, we have good stocks and we don't need[more]materials, especially considering the demand from end users."
It was reported that one plant in the Benelux region was still experiencing technical problems, and therefore did not have a coil available for delivery in June, the sources said. Due to technical problems, the supplier reduced supplies by 70,000-80,000 tons of HRC in the short term and, therefore, could not be very flexible in pricing. Offers for July were received at a price of 740-750 euros per ton from the plant, but no confirmed transactions were reported at this level.
The European HRC indices from Fastmarkets were not published on Monday, May 4, due to the spring bank holidays in the UK.
But Fastmarkets' daily hot-rolled steel roll price index for domestic sale, exw in Northern Europe was calculated at 698.75 euros per ton on Tuesday, down 3.75 euros from the last May calculation of 702.50 euros per ton1.
The indicator decreased by 6.88 euros per ton week-on-week and by 20.01 euros per ton on a monthly basis.
In Southern Europe, Fastmarkets' daily domestic hot-rolled steel price index, exw in Italy, was 693.75 euros per tonne from the factory on Tuesday, down 1.25 euros from the last calculation of 695.00 euros per tonne on Friday, May 1
The indicator decreased by 6.25 euros per ton week-on-week and by 5.00 euros per ton on a monthly basis.
Trading in the Italian HRC market remained weak, where, according to sources, market prices continued to fluctuate below official offers.
"The[HRC]market is at ground zero. No new requests, no new negotiations European factories were unable to raise prices[for supplies in July], despite being protected by several trade barriers.",
