Hot Rolled Coil Prices Continue To Rise In Western Europe
Hot-rolled coil prices in Western Europe have not slowed their advance over the past month. Demand continues to exceed supply for the flat-rolled product, industry watchers said on June 1.
“It has everything to do with the high demand in Europe and the United States,” a trader told MetalMiner.
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Hot Rolled Coil Prices Rise
Sources have confirmed hot-rolled coil prices at € 1,120-1,130 ($ 1,370-1,385) per metric tonne exw for rolling and fourth quarter delivery. This compares to hot-rolled coil prices of € 1,000 to € 1,020 ($ 1,225 to $ 1,250) in May.
The cold-rolled coil now carries a premium of € 125 ($ 150) per tonne over the HRC, sources said.
The auto and construction sectors are behind the strong demand, a source said.
New passenger vehicle registrations within the European Union rose 218.6% year-on-year in April to around 862,226 units from 270,651 units, said the Association of European Automobile Manufacturers (ACEA ) on May 19.
The restrictions from the COVID-19 pandemic in April 2020 were the main reason for the increase, the association noted, however.
“Indeed, despite this sharp percentage increase, last month’s sales volume was almost 300,000 units lower than in April 2019,” added ACEA.
New passenger car registrations for the first four months of 2021 rose 24.4% to 3.42 million units from 2.75 million units, ACEA noted.
The pressures on the supply chain in the automotive industry, especially for raw materials, are also pushing up the prices of vehicles. You’re here automobiles, reports cite the CEO of the automaker, Elon Musk, as claiming on May 31.
Tesla’s main production site is in California. The company also has an operating factory in Shanghai and plans to open another in 2021 in Berlin.
The German construction industry has also reported difficulties in sourcing needed materials on a timely basis. For example, there have been steel shortages, the Munich Institute for Economic Research said on June 1.
“In building construction, 43.9% of businesses reported in May that they were having problems procuring building materials on time. This is an increase from 23.9% in April and just 5.6% in March, ”said the Institute for Economic Research.
Rising prices for iron ore, the main component of steelmaking, also translated into higher costs for steel.
The benchmark 62 Fe iron ore finished last week at $ 205.73 per metric tonne cfr China. The price jumped more than 15% from $ 178.80 on April 28. The commodity price also hit a high of $ 218.38 on May 12.
Sources believed prices would continue to rise for at least the next two months,
“All [metric] ton of steel you have you can sell, ”the trader said of the current market conditions.
Prices are expected to slow in August, as most of Europe will likely be on vacation by then, the trader added.
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