EU HRC Market Holds Steady Amid Regulatory Fog and Year-End Lull

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HRC offers are unchanged at €600-620/t EXW in Northern Europe and €590-610/t EXW in Southern Europe. Import offers are steady at €490-510/t CIF Italy.

The trading environment is subdued, shaped by limited spot transactions and persistent regulatory uncertainty. Across the EU, market participants reported a shared reluctance to engage in forward purchasing. The lack of clarity surrounding CBAM cost calculation and the final structure of the EU’s updated safeguard regime has left procurement strategies in limbo. Buyers continue to resist any price increases, preferring to wait until there is greater visibility on regulatory obligations.

Import activity also remains muted. Competitive offers from Asia and Turkey have failed to generate meaningful traction. Market participants cite the perceived risk of customs exposure, uncertain carbon liabilities, and quota constraints as key reasons for avoiding import bookings. “Buyers are in no hurry to place new orders. It seems they don’t see an urgent need to replenish inventories now”, a German trader told WSD.

Overall, sentiment remains cautious. While some market participants expect price momentum to build in early 2026 due to supply-side constraints, current fundamentals suggest little urgency in the market. High inventory levels, especially in commodity-grade coil, and the absence of significant demand growth signals from downstream sectors continue to suppress spot activity. For now, both sides of the market appear content to wait out the holiday period before reassessing conditions in the new year.

WSD Take.

WSD reiterates our Q1 HRC price forecast of €620-660/t, noting that the relatively modest initial impact of the CBAM will limit near-term price upside. CBAM will effectively function as a non-tariff barrier, curtailing import flows due to significant uncertainty in liability calculation.

Q1 imports could fall by 20-30% y/y, underpinning a potential €20-30/t increase across all product segments in January-February. A sustained rebound in import activity is improbable before Q2, once exporting mills finalize emissions verification.

The draft of the EU’s new market protection system is expected to be approved by the relevant parliamentary committee in mid-January, and it appears highly likely that it will be enforced from July 2026. The EU’s new safeguard system is expected to create supply difficulties and trigger a sharp price increase starting in March-April. EU mills have already announced HRC prices for March at €660-690/t and for April-May at €720/t, which is close to our expectations.

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