EU HRC Market Awaits Price Impact as New EU Import Rules Reshape Supply Expectations
HRC offers remained at €680-700/t EXW in Northern Europe and €670-690/t EXW in Southern Europe. Import offers are stable at €600-620/t CIF Italy.
The publication of the European Commission’s country-specific quota allocations under the new steel safeguard regime has triggered various reactions across the European hot-rolled coil market, although prices have so far remained broadly stable. Market participants describe the new framework as substantially more restrictive than expected, as the new allocation mechanism has significantly tightened access for several traditional suppliers, in particular Turkey, whose HRC quota has been cut by around 60% compared with the previous safeguard system.
The announcement has strengthened expectations of tighter import availability during the second half of the year. Buyers, traders and processors said the new rules would force companies to rethink their sourcing strategies, with many concluding that domestic mills would become the primary source of supply. Some traders also argued that the new system adds considerable administrative complexity, making it more difficult for new overseas suppliers to enter the European market.
Several Asian exporters tried to increase offers to Europe, but this hasn’t impacted the market. Buying activity remains subdued because most distributors and steel consumers are still carrying comfortable inventories and have little need to secure additional volumes. Many buyers believe weak demand, seasonal summer slowdowns and cautious spending by steel-consuming industries will continue to limit domestic mills’ pricing power in the short term. “I expect the full impact of the new safeguard regime will only become visible in the fourth quarter, once existing inventories are depleted. Until then, buyers won’t be active on the market,” a German trader assumes.
WSD Take.
In July-August, a rapid surge in pricing appears unlikely, with a more gradual increase possible amidst seasonally weak demand. Come September-November, WSD expects HRC prices close to €800/t due to lower import availability, a lag in domestic supply growth and depleted stocks.
Local supply is unlikely to expand sufficiently to meet any surge in demand, with mill margins remaining below average at €178/t in mid-June. The pause in buyer activity in June is set to result in a substantial erosion of inventories. The inventory build-up since Q4 2025 is expected to be broadly neutral, which will leave buyers vulnerable in Q3 amid a supply shock from reduced import availability.