Northwest Europe CRC prices come under pressure
Coil prices in Europe continue to soften further as the summer nears its end, with cold-rolled coil struggling to maintain its value against hot-rolled and galvanized coil.
CRC production can cost nearly the same as galvanized-coated coil, according to a German industry senior. The re-rolling requires re-heating, while the process for galvanising HRC undergoes a heating effect during the zinc bath.
“That’s why certain sorts of CRC match the costs of galvanized coil,” he says.
Additionally, many mills can roll HRC to low thicknesses under 1mm that elsewhere require extra cold-rolling.
Traditionally, hot-dip galvanized coil tends to be at least €100/tonne ($110) higher than HRC, and CRC around €80 higher.
Some buyers in Germany and the Benelux confirm this relation, giving the lower current end for HRC from domestic mills at €580/t ex-works, and that of CRC at €660-670. HDG remains stronger, still holding at above €700.
Until a month ago, CRC prices had also held at above €700, but have since notably given in.
For months, mills had little interest in making CRC because of import pressure, industry observer tells Kallanish.
When European prices were still €20-30 higher a month ago, CRC imports could be had for €660/t delivered Ruhr. Domestic pricing has meanwhile closed in on import prices.
One German consultant with a proprietary forecast model assessed CRC already last month at around €680. That was only €60 above the HRC price of €620 that prevailed then, and confirmed the impression of many that the HRC-CRC gap is narrowing.
A Dutch service centre points at the “low appetite” from the automotive sector, a main consumer of CRC. This is especially painful for the integrated mills with their automotive-grade qualities.
According to him, demand from automotive for steel is 10-15% lower than last year.
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Anonymous
Very good overview of the weekly steel market.
Anonymous