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N.W.European coil mills may struggle to achieve Q4 increases - 15 August 2011

The import threat has dissipated in the northwest European coil market, but local mills may still struggle to implement price increases heading into the fourth quarter, sources in the Benelux region and Germany tell Steel Business Briefing.

“Because of the insecurity about the future of the global economy, people are not buying,” one German trader says. “We won’t get a deep crash in steel prices as we have had before, but what I think, and many others agree, is that the increases that were tabled for the next couple of months will not take place.

One mill source admits prices may fall as a result of the current uncertainty. Mills were hoping for €20-30/t increases in September-October, SBB notes.

Northwest European mills are currently offering September-October produced hot rolled coil at €530-540/tonne ($755-769/t) ex-works base, while stock lots are available from Antwerp at similar levels. Cold reduced coil is being offered at €590-620/t ex-works base from local mills, SBB hears.

New HRC imports offers are now around the €540-550/t cfr Antwerp, but people are unwilling to book at these levels given the uncertain market and longer lead times. Indian mills have been the cheapest source in recent weeks, at €510-515/t cfr Antwerp, however offers have moved up €20-30/t and they are unlikely to want to book much tonnage at such prices.

Demand is very quiet with large swathes of northwest Europe on holiday. There are currently mill/customer shutdowns in parts of Belgium, France, the Netherlands and Germany, sources concur.


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