EUROPE SECTIONS: Rising coil costs threaten to squeeze Northern EU tube mills

The sluggish hollow steel sections markets in Northern Europe must achieve higher prices or else tube producers will see their margins be eroded by stronger costs for hot-rolled coil (HRC), market sources have warned.

A fresh increase of €10-20 per tonne in the price of Northern Europe-origin hot-rolled coil (HRC) on Wednesday February 7 leaves tube mills with thin margins when transforming the material into hollow sections. In the three years from February 2015 to February 2018, the average premium for Metal Bulletin’s domestic square hollow sections prices in Northern Europe over hot-rolled coil (HRC) prices in the same region was €102 ($126) per tonne. On Wednesday, the premium was just €83 per tonne. Although there is clear cost pressure on the market, disappointing end-user demand is preventing mills from...

Published

Lee Allen

February 07, 2018

18:15 GMT

London