EU HRC exports surge in March

Exports of hot-rolled coil (HRC) from EU countries rose to the highest monthly level since November 2017 in March, amid slow local demand and rising imports.

Exports amounted to 369,904t, increasing by 45pc from February and by 41pc on the year. More than 48pc of the total, or 178,767t, was shipped to Turkey — up by 87pc on the month. In comparison, EU imports of Turkish HRC rose by 24pc from February and by 6.6pc on the year to 319,289t.

EU countries exported significant volumes of HRC to Egypt, Tunisia and the US in March, while imports from Russia and India continued to edge up.

Italy marked the highest year-on-year increase in exports, which is the result of the ramp-up at the ArcelorMittal-owned Ilva mill, with HRC exports reaching 33,280t in March compared with just 4,487t in March 2018. But Germany and Spain ramped up exports as well.

The largest exporter was the Netherlands with 194,033t shipped in the first quarter compared with 141,969t in January-March 2018.

Overall, EU third-country exports amounted to 856,349t in the first quarter, rising by 12pc on the year.

Meanwhile, EU imports were higher on the month and on the year in March at 755,536t, but lower than the January high of 924,327t. Italy continues to be by far the largest destination for imports, with March volumes up by 39pc on the year at 371,831t. Imports to Spain nearly doubled to 124,027t compared with 62,073t in February.

Customs clearing data tracked by Argus indicate that EU imports of HRC came close to 900,000t in April, but have so far this month slowed down and are likely to slow further over the summer months, as a result of Turkish mills being essentially priced out since the beginning of April amid declining local values.

Yet the quota for HRC could exhaust before the beginning of July, when it resets, with 881,373t of it left as of 17 May out of an allocation of 2.05mn t for the period 1 April-30 June. With the residual amount for February-March of just over 34,000t added in, average daily imports since the beginning of April amounted to around 44,360t. Imports would need to slow to an average daily rate of under 20,000t if the quota is not to be exhausted before the end of June.