EU HRC: Northwest prices nudge lower

Northwest European hot-rolled coil (HRC) prices slipped today amid quiet trading, as production continued to outstrip demand and buyers were reluctant to take any material that may arrive later in the fourth quarter.

A large European producer is still able to offer November delivery into Benelux, while lead times from at least one Italian steelmaker also remained short. As a result, buyers do not want to book and be laden with inventory that they think could depreciate over the holiday season in December.

A tier-one German mill has recently offered at €445/t ex-works to one buyer, and service centres now expect they will get lower prices from Italian mills — where pricing has fallen quickly of late — and second-tier Benelux suppliers.

With real demand, weak service centres are fighting for business, which is cutting into outsell prices and dissuading participants across Europe from booking replacement material. Traders expect import prices to slip to €390/t cfr Italy and below as importers look to compete with softening domestic levels.

The Argus daily northwest Europe HRC index fell €1.50/t today to €446.50/t ex-works. The northwest Europe forward curve also dropped, with October at €448/t, and November and December at €443/t. The daily ex-works Italy index was static at €417/t.