(HSV VIETNAM GROUP) – Weak steel demand in Europe, Middle East and North Africa (EMEA) has forced some mills to source upstream products and seek different geographical markets.
A Turkish reroller has been supplying hot-rolled coils as well as processed steel sheets and strips to several European customers, instead of supplying cold-rolled coils, hot-dip galvanizing and pre-painted materials.
Rolling mills buy HRC to process into downstream products so they are selling their raw materials, a testament to slowing demand domestically and in the EU. The factory is also subject to the lowest anti-dumping duty on hot-dip galvanizing to the EU of all Turkish factories, thus having an advantage over its counterparts.
The mill is the only one able to complete sales of HDG into the EU as of now and mainly to destinations near Türkiye. Some other factories are not even attracting EU customers and they only see potential opportunities on CRC, although the buyer's target has recently decreased due to falling EU domestic prices. In fact, a Turkish factory source said EU domestic delivery prices are now lower than Turkish FOB prices, which ends any limited arbitrage options. If resellers sell HRC into the EU, they will be subject to a 7.3% anti-dumping tax.
Another re-roller with a much higher HDG anti-dumping tax also said it is trying to sell HRC to the EU to improve export activities.
A mill in Italy has begun exporting HRC to North Africa and is also looking to sell steel plates to generate much-needed cash.
Another Italian manufacturer, with a delivery time of just a few weeks, has also assessed requests but still prefers to give discounts to EU buyers rather than export, the source said. The factory has cut offers on all products over the past week to generate revenue. Market participants said this is often their strategy in a downturn market, even though not too many sales are understood to be taking place.
Other European factories are looking for export opportunities as domestic demand slows. There has been discussion about selling into Türkiye and North Africa, as well as into the US, Mexico and Canada. European manufacturers are finding it difficult to compete in Türkiye because of anti-dumping duties and entering other markets are receiving cheaper offers from China and Asian factories.
Ha Diem HSV