EU HRC Market Struggles to Reconcile Mill Ambitions with Buyer Reluctance

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HRC offers rose €10/t to €600-620/t EXW in Northern Europe. In Southern Europe they increased by €5/t to €590- 610/t EXW. Import offers remained at €480-500/t CIF Italy.

Across Northern and Southern Europe, trading activity was limited, with market participants describing a disconnect between mill pricing targets and what customers were realistically prepared to pay. Buyers remained focused on managing existing inventories. As a result, appetite for new volumes was limited, especially with no signs of a meaningful recovery in downstream consumption.

Mills, nonetheless, maintained a firm pricing posture, citing expectations of constrained supply in early 2026 due to regulatory factors, including safeguard revisions and CBAM implementation. However, market sentiment reflected more skepticism than support, particularly as many customers have already closed their purchasing books for December.

Import alternatives, while perceived as increasingly complex, continued to attract attention. Some buyers reported receiving competitive offers from Asian suppliers, inclusive of estimated CBAM costs, but hesitated to act amid administrative uncertainty and long delivery times. The growing appeal of DDP offers indicated an ongoing shift in how buyers seek to manage risk, preferring suppliers who absorb compliance burdens.

“Buyers are unwilling to take on the risks associated with CBAM. For suppliers, offering pricing that accounts for CBAM-related costs is the issue of maintaining competitiveness. It is a possibility for future surviving in the market”, an Italian trader commented to WSD.

WSD Take.

WSD forecasts HRC prices to reach €610-620/t EXW NW Europe by December, €630-660/t in Q1, with a gradual increase to €750-780/t by July 2026. CBAM works as a technical barrier as buyers, faced with market uncertainty, have shunned import bookings for Q1. This shift strengthens EU steelmakers’ pricing power for January settlements. We project Q1 import volumes to decline by 12-15% y/y, however, the import contraction in January is likely to be more severe, potentially creating supply shortages and driving further price increases.

Media reports have widely mentioned leakage of default emission values and CBAM benchmarks for free allowances. Analyzing those reports, we see that CBAM payments may turn out to be lower than previously expected by the market. However, the use of single default emission values per country poses a risk to EAF-based producers – mainly concentrated in long-rolled segment – as it fails to reflect their lower carbon intensity.

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