Prices for hot-rolled steel in Northern Europe rose on Friday, July 3, due to increased supply from distributors, while prices in Italy declined amid uncertainty caused by the introduction of new quotas on steel imports to the EU and low trading activity, Fastmarkets sources said on Friday.

In Northern Europe, the supplier announced an offer for the September supply of raw materials at 720 euros ($823) per tonne from the factory on Friday, but this price was declined because it did not meet the six-week maximum delivery time set by Fastmarkets.

The buyer said that a major supplier had increased the offer price by 20 euros per ton to 690 euros per ton from the factory, adding that "other factories are talking about good orders, but they don't want to talk about prices."

Market participants reported limited trading activity on Friday, with many still assessing the impact of the new EU quota system for steel imports, which came into force on July 1.

"The shock is growing, and some people have already told me to pay some fees. Firstly, we will see that some problematic cargoes will have to be shipped elsewhere," a trade source said on Friday.

The same source added that most of the quotas have probably already been exhausted, although Fastmarkets cannot independently confirm this using data from the European Commission.

The daily price index for Fastmarkets hot-rolled steel in the domestic market, exw in Northern Europe, as of July 3 was 695.00 euros (793.28 US dollars) per ton, which is 4.06 euros higher than 690.94 euros per ton on Thursday, July 2.

The indicator increased by 12.50 euros per ton week-on-week and by 5.00 euros per ton month-on-month.

Market conditions in Italy were different from those in Northern Europe, and sources reported that local businesses had mostly withdrawn their offers, assessing the impact of the new quota regime.

Market participants attribute this to Italy's greater dependence on imports of HRC compared to Northern Europe, which makes the market more susceptible to the new regulation.

"Italian factories have lowered their quotes[because]they need to announce new price levels," the supplier told Fastmarkets on Friday, but was unable to provide reliable pricing information.

A buyer's source reported achievable prices of 670 euros per tonne from the plant on Friday, while previous data had been mostly at 680 euros per tonne from the plant on July 2. However, the same source said that market conditions could change rapidly as participants adapt to the new import regime.

According to Fastmarkets, daily prices for hot-rolled steel for domestic consumption, exw in Italy amounted to 676.67 euros on July 3.

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