International Steel Market Daily: Expectations For Further Strength in The European Hot Coil Market As Prices Rise

The current heatwave price in the European market is around 650 euros/ton EXW, with a decrease in tradable prices of around 20 euros/ton and an increase of around 30 euros/ton on a weekly basis. The price decline this time is mainly due to steel mills actively reducing production. Against the backdrop of poor demand expectations, the recent wave of price strength has also led market traders to start restocking. However, even in the face of the upcoming Christmas holiday and winter, traders are not in a hurry to accumulate inventory, mainly due to the inconsistent views of the market on the sustainability of price strength. The current market logic leans more towards reducing production to ensure that prices do not fall again. Even if prices show an upward trend, overall, most steel mills are still in a state of loss. Therefore, actively reducing production is an inevitable trend to ensure that prices are in an upward trend. However, it is still worth considering whether the expectation of reaching 750 euros/ton EXW can be achieved. It is reported that some car companies expect market prices to continue to decline, so they have postponed their originally planned fourth quarter production plan to the first quarter of next year.