During the last days, some of the steel mills have decided to increase prices for their June / July deliveries in Europe. Most probably the move has been dictated by the revival, in fact very shy, but still a revival of the demand.
As a matter of fact some of the major EU stockholders and SSC are "overlooking out of the window" trying to understand which kind of weather they can expect. Many of them are suffering of quite un assorted stocks, that cannot be anymore re filled by the "barters" and "compensation deals" they have been following during the last months with their companions.
Required quantities are still low, as all buyers are mainly or better to say only trying to fill up the holes in their inventory. Proposed prices are as well still very low, reflecting the demand that also remains at extremely low levels. However, buyers are now experiencing that is not easy at all to find material and definitely very difficult at the wanted prices.
The production pruning applied by all EU Mills in combination with the low quantity level of the inquiries, are making complicate the task of receiving suitable offers. That's why some Mills have decided that is high time to force the door and try to come out in the "green".
HR is now demanded at around EUR 310 per tonne to EUR 320 per tonne on CFR FO basis, with some outsider like North America Mills looking for EUR 325 per tonne and up plus extras. It also applies to CR, where mills are now looking for prices close to EUR 400 per tonne CFR FO. HDG remains on the contrary still very weak although some small business has been booked at prices above EUR 470 per tonne CFR FO Mediterranean.
As usual, next few days will show if this attempt will be successful. As mentioned above, the demand remains quite sluggish and many other buyers are still respecting a policy of no-purchase at any price. Also, 2nd and 3rd level Mills are desperately looking for orders and still available to aggressively negotiate.
Our opinion is that market will continue like last period with short and thin waves of up and down price moves. However, it is important to carefully choose the right wave to avoid being unhorsed.