EU HRC: Prices down with mills eager to sell

European hot-rolled coil (HRC) prices edged down today as mills remained eager to sell, with production cuts having little impact on the supply and demand balance.

A German mill has offered to service centres at €445/t ex-works, and to larger buyers at €430/t ex-works, fuelling buyers' expectations that they will get cheaper offers from second-tier producers in Europe.

Egyptian mills have started to offer into Europe, primarily the south, at around €405-415/t cfr, with the higher end related to Iberia and the lower end for Italy. But buyers are not desperate to procure, given mounting uncertainty.

Turkish mills are reportedly not desperate for sales, and are offering December shipments for the most part, while Italian buyers are bidding them at around $400-410/t fob. But one Turkish seller has offered as low as €380-385/t cfr Italy for November production, and it is usually not the lowest-priced mill.

A buyer said most import offers into Italy are at €400/t cfr for large shipments, but that this will be the level for smaller lots in the next few weeks.

Most sources suggest that the northwest European market will largely remain quiet until an industry event in November, but slack activity and a need for mills to move product is still nudging prices lower. Argus' daily northwest Europe HRC index slipped by €3/t today to €443.50/t ex-works.

Argus' daily Italian HRC index dropped by €2.50/t to €414.50/t ex-works, with buyers still reticent to procure ahead of the year-end and given ongoing weak real demand, and the expectation that prices will slip further. One local Italian steelmaker has amassed significant inventory ahead of a maintenance stoppage, while another producer has availability for beginning of November production.

Traders continue to lowball domestic mills. One suggested he is close to booking sub-€400/t ex-works from a northwestern mill, while another has bid at such levels — but his enquiry has not yet been returned.

US president Donald Trump's imposition of tariffs on EU products, in response to dumping in the aerospace sector, has soured sentiment. While these tariffs were different, in that they were mandated by the World Trade Organisation through the normal process, it has sparked concern that Trump will follow through on his Section 232 investigation into European automotives and their components.

This would be a huge blow for European steelmakers — much bigger than the existing tariffs on steel.

The northwest Europe HRC forward curve dropped, with October at €447.75/t, November €441/t and December €441/t.