EU Steel Buyers Remain Cautious as Policy and Demand Outlooks Stay Unclear

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HRC offers held firm in Northern Europe at €560-580/t EXW. Prices in Southern Europe rose by €10/t to €545-565/t EXW, with import offers into Italy stable at €480-495/t CIF.

Across the region, trading sentiment was cautious, with many service centers reporting minimal inquiries. With Q4 demand still weak and inventories considered adequate, most distributors are avoiding forward commitments. Despite some bullish talk from producers, mills have so far struggled to translate offer hikes into real transactions.

Uncertainty surrounding EU regulatory policy continues to dominate market discussions. Market participants are closely watching for formal announcements from Brussels on the future structure of steel safeguard measures, as rumors of quota reductions or tighter restrictions circulate.

“The leaked draft with the European Commission’s proposals offers some insights into the scope of future changes, but many details remain uncertain. There is a little time left to implement such far-reaching reform, if the aim is to change the rules since the beginning of the next year”, a German trader believes.

Compounding the uncertainty is the delay in the implementation of CBAM benchmarks, now postponed until 2026. The lack of guidance on carbon cost calculation and customs clearance rules has rendered forward imports particularly risky, especially for Asian-origin material with long lead times. Buyers fear that deliveries arriving in early 2026 will fall under the full scope of CBAM, exposing them to unknown carbon cost liabilities.

WSD Take.

According to our estimations, European HRC prices could rise to €610-620/t by November-December, driven by CBAM-related cost pressures. A further increase is likely in Q1 2026 amid expected supply tightness, with our base-case forecast at €650/t.

We expect a significant influx of imports in October, which will cap any price increase potential until November. November and December are likely to see sluggish import activity, as key quota-based sources will be exhausted. A supply shortfall is likely in Q1 2026, driven by a collapse in imports.

EU steel demand continued its gradual recovery in the third quarter, rising by 1.8% y-o-y in July amid positive sentiment in the industrial and construction sectors in some regions. However, this remains insufficient to drive the market. Supply-side factors are now the key price drivers, namely the introduction of the CBAM and changes to the safeguard system.

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