Skip Navigation LinksHome|News & Analysis|News Features|News Feature Detail


Europe, Black Sea steel prices seek support from iron ore, coal costs

By Hector Forster in London

May 16, 2011 - The steel market in Europe and CIS is feeling some renewed upswing in price sentiment following some softness over the past two months.

After a dip from an early 2011 spike in steel prices in Europe, the US and Asia, concerns of further longer-term downside and severe price swings are reducing as raw materials prices persist at near record levels, traders, steel buyers and producers say.

European and Black Sea region flat steel prices, based on Platts assessments, are seeing some stabilization and hint of recovery following a month or so of declines. (See related chart: Rebar FOB Turkey & HRC FOB Black Sea (US$/Mt)).

Sources expect likely high raw materials costs, at least for the third quarter, and some improving steel purchasing sentiment going forward after buyers held off already enough.

Article continues below...

Request a free trial of: Steel Markets Daily Steel Markets Daily
Steel Markets Daily

Steel Markets Daily provides you with Platts expert commentary including comprehensive daily and monthly articles and news briefs on each of the critical markets -- plus, access historical prices for hot-rolled coil, rebar and other products. You’ll also have access to 25 daily spot market prices and monthly averages from trading hubs in Europe, North America and Asia

Request More Information Request a trial to Steel Markets Daily

“Raw material price increases usually trigger demand,” said Gorkem Bolaca, general manager of trader LN Metals London branch.

”When raw material prices increase, buyers expect further increases in the market and tend to place orders as fast as they can in order to take more of an advantage on prices.”

Iron ore and ferrous scrap prices have risen in April after dipping in March. (See related charts: IODEX 62% FE CFR China (US$/Mt) and Ferrous scrap CFR Turkey (US$/Mt)).

While still short of a record $193/mt CFR China for Platts benchmark IODEX iron ore assessment at the end of February and Chinese purchasing ever erratic, prices have seen support.

Rebar FOB Turkey & HRC FOB Black Sea (US$/Mt)

Limited Indian supplies and better-known Australian brands more regularly traded on a spot basis helped the market shake off the mid-March low of $164.50/dmt CFR China.

Chinese hot-rolled coil steel prices have slumped as Japanese mills offer into Asia at more competitive levels, while the nation’s production end-April raced to the highest rate this year, based on reported China Iron and Steel Association figures.

Coking coal prices, like iron ore, remain near all-time highs buttressed by a supply shortage since floods hit Queensland - the industry’s main source of exports.

Return to top

Next page: Iron ore Q3 contracts threaten to stick close to current quarter prices

Copyright © 2018 S&P Global Platts, a division of S&P Global. All rights reserved.