Domestic HRC prices in Italy rose in mid /late September and stabilized in early October as purchasing activity declined. Supply is limited due to production cuts at several steel mills.
Imports are possible, but with the exception of a number of large buyers, buyers are wary of purchasing materials in Turkey due to revised quarterly protective quotas and the threat of retrospective trade actions.
In Spain, mills have not yet reached the minimum target base price for hot rolled coils of € 500 /t. Distributors report that day-to-day business activity is average. In the downstream market over the past month, hot rolled sheet prices have matched the recent increase in base coil prices.
Cautious purchase despite auto-recovery
Italian buyers of cold-rolled and hot-dip galvanized coils expect supply to remain limited in the near future, local mills are well stocked and imports are insufficient to fill the gap. The automotive sector is recovering and the packaging industry continues to perform well.
However, many buyers have become wary of the mid-term market trend. Therefore, they only buy for their immediate needs. Purchasing executives report that they are monitoring their inventory levels to reduce risk.
In Spain, mills expect additional price increases for value-added steel products due to material shortages, but many buyers are taking a wait-and-see attitude, carefully managing their inventories. Hot dip galvanized coil producers are reportedly targeting a minimum base price of € 600 per tonne.
Spanish distributors indicate that the needs of car companies are using a significant portion of the existing plant capacity, but argue that supply and demand will be more balanced by the end of the year. Meanwhile, domestic steel buyers anticipate a short-term price trend before making significant purchases.