[Ferro-Alloys.com] ArcelorMittal today announced a €440/t ex-works base price for hot-rolled coil (HRC) in the northwest European market, buyers told Argus.

 

It will also move up accordingly across other products and regions.

 

The announcement was eagerly awaited by market participants, given the historically low spreads for HRC over raw materials and the international upturn that has reduced import penetration and given domestic producers more of a captive market.

 

There are market expectations that the stocking cycle might reverse from September and into the fourth quarter of the year, with customers beginning to rebuild their inventories as the impact of Covid-19 dissipates to an extent. The market has been characterised by destocking, in the weak demand environment of late, with service centres and buyers trying to reduce their inventory positions in a depreciating price environment.

 

ArcelorMittal has also informed customers that it will target increases in south Europe and offer on a case-by-base basis, though customers were not informed of any official new offer.

 

Argus' benchmark daily northwest EU HRC index has fallen by €19.25/t since the start of June to €386/t yesterday, a historical low for the series that launched in November 2018.

 

The CME forward curve has been at a strong contango to the index of late although July fell yesterday, trading down by €22/t to €408/t. August was still trading at €426/t, with September and October at €430/t and €438/t, respectively.

 

Source: Argusmedia