EU HRC Prices Edge Higher Amid Tight Supply and Regulatory Pressures

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HRC offers rose €20/t to €650-670/t EXW in Northern Europe and €10/t to €630-650/t EXW in Southern Europe. Import offers increased by €10/t to €500-520/t CIF Italy.

The latest price increases are being driven less by demand and more by regulatory factors – particularly the introduction of Carbon Border Adjustment Mechanism and the anticipated tightening of EU safeguard quotas. Uncertainty around quota distribution and CBAM charges continues to weigh on interest in imported material, even as some Turkish, Algerian, and Taiwanese offers are priced around €600-630/t DDP. In this environment, domestic producers are holding firm on higher offers, while buyers are slowly adapting to the new reality.

Whereas real demand remains fragile, sentiment is broadly optimistic. Many distributors believe that once March bookings are closed, producers will gain leverage to push prices further, especially with seasonal demand expected to pick up in Q2. Longer lead times are also seen as supporting a firmer price environment, giving service centers greater control over downstream supply.

At the same time, ample inventories across service centers and ports are slowing the pace of market movement. Buyers remain cautious, focusing on short-term coverage rather than long-term restocking. Many prefer to wait for greater clarity around CBAM implementation and quota allocations before committing significant new purchases. “Despite some near-term pricing volatility, the European HRC market appears poised for further consolidation at elevated levels through next two months. Buyers will have to return to the market to replenish inventories”, a German distributor believes.

WSD Take.
WSD forecasts Q1 HRC prices at €640-660/t NW Europe EXW, with a further increase to €730-750/t by July 2026 when the new TRQ system comes into effect. Amid prevailing uncertainty, imports into the EU are only viable on a DDP basis, with import prices needing to be at least €20/t below EU EXW levels to incentivize traders.

The higher risk and cost of imports due to CBAM have shifted buyers toward local steelmakers. We expect EU steel output to grow by 6-7% y/y in Q1-Q2. According to satellite imagery analysis cited in media reports, EU integrated mills have ramped up capacity utilization to their maximum. At the same time, flat-rolled imports unexpectedly surged in the first half of January, exceeding volumes from the same period last year by 11%. Should imports remain robust into February, bolstered by favorable prices, the market could face an oversupply situation.

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