EU HRC: Mood in Italy lifts

Sentiment in the Italian hot-rolled coils (HRC) market seems to be improving, despite no increase in end-user demand, but higher import offers and brisk exports from mills are expected to aid domestic negotiations.

Producers have been focusing on sales of cold-rolled coils (CRC) and galvanised steel, having found export opportunities in northern Europe, the UK and Poland. Sales to North Africa could be possible. Italian mills are pushing for €540/t ex-works for CRC and galvanised and above, but are under less pressure to sell. One producer is trying to implement a €10/t increase for April delivery.

A service centre today said that it is exporting three times its usual volumes.

Imported HRC is now out of reach for most buyers, with even some of the largest unable to get enough of a discount to warrant procuring from abroad. HRC from Turkey was available at €470-480/t cif Italy this week, but a buyer received offers at €480-490/t cif. South Korean pickled and oiled coils were offered at €510-520/t cfr, but attracted a bid €30/t below, market participants said.

The lack of lower-priced imports, in addition to the sufficient quantities sold in the export market, is expected to lend support to mills' consistent push for an increase in HRC and see buyers in need of material with no choice but to pay higher prices, market participants said.

The Argus daily Italian HRC index increased by €1.50/t to €442.50/t ex-works. The northwest European index was stable at €481.25/t ex-works.