EU HRC Market Remains Under Pressure as Buyers Stay Defensive
HRC offers decreased by €20/t to €680-700/t EXW in Northern Europe and to €670-690/t EXW in Southern Europe. Import offers into Italy rose €10/t to €600-620/t CIF.
Despite attempts by producers to defend higher targets, buyers showed little willingness to engage at those levels. Only limited tonnages are being transacted, and at discounted prices. In general, market participants now anticipate a relatively stable but depressed market environment heading into summer.
Service centers and distributors continue to report comfortable inventories and weak order inflow from end-users, reducing the urgency to replenish stocks. Buyers are delaying larger purchases in anticipation of either further price corrections or greater clarity on the European Union’s upcoming safeguard regime. As delivered prices for imported material increasingly approach or undercut local levels, buyers’ appetite for large import commitments remains limited. “Consumers don’t rush to replenish inventories. For now, they appear to have enough flexibility to wait and see how the market develops in the coming months,” a German distributor said.
Participants across the market also highlight the growing impact of geopolitical tensions and rising energy costs. The conflict in the Middle East has increased freight and transportation costs while further complicating global trade flows. At the same time, many European buyers understand that the combination of CBAM and tighter trade protection measures is fundamentally reshaping the market, making imported steel less competitive over the long term.
WSD Take.
Import inflows in April were likely stronger than the 20% y/y we see under the TRQ alone, owing to active shipments from Asian TRQ-exempt origins. “Pre-verification” of 2025 emissions has reduced risks for importers and allowed them to broaden the geography of imports compared with Q1. If the Q4 2025 pattern repeats, the final month of the quarter could deliver strong restocking via imports from TRQ-exempt origins.
EU mills, enjoying margins of over €200/t amid export difficulties, have begun to prioritize utilization and agree to discounts off list offers. With imports running strong early in the quarter, this gives buyers the leverage to secure lower prices. WSD forecasts HRC prices in May at €700-730/t NW Europe EXW, with any further price increases likely to be gradual.
The leaked “negotiating principle for country allocation of import quotas” suggests that the release of country specific quotas will likely be delayed until the second half of June. This will make it impossible to contract imports properly for July and the first half of August. As a result, risks to Q3 imports have increased. Supply tightness will be particularly noticeable in September-November, when demand typically peaks. We believe the price of above-quota imports will serve as a benchmark for the EU market, pointing to €820-860/t for HRC.