Hot-Rolled Coil Prices are Falling Due to Bearish Demand in Italy

As per our sources, the prices of Italian Hot-Rolled Coils have yet to reduce because the spot prices for the domestic Hot Rolled Coils continue to fall amidst the sluggish demand and cautious buying activity, despite buyers' and sellers' eagerness to witness some stability in the prices. This declining trend of Italian Hot Rolled Coil has been followed since April. Additionally, against the backdrop of the price recession, fears among end-users, re-rollers, and service centres persist in restricting orders to low volumes in the local market and for import purchases. The limited transactions and dull market sentiments in the regional market further prompted market participants to adopt a wait-and-watch outlook for further price trends.

As per domestic market participants, buyers already have more than sufficient stockpiles, which further persists in subduing trading activities in the domestic market. Additionally, market fundamentals have not changed in Italy since the end of April, and trading in the regional market is still very poor, with low customary demand coupled with overstocking at the buyer's site. While raw material requests from service centres are particularly slow, their customers' activity is still visible at a far slower pace than in Q1. However, in such an adverse and uncertain environment, buyers are reluctant to commit to more significant volume purchases. Service centres are ordering as little as possible this week, around 210-310 tonnes, primarily to test the market, as they have in previous weeks. The firms that supply the Hot Rolled Coil to the automotive industry are suffering and concerned that the lack of inquiries will persist until September.

On Wednesday, the price of Italian Hot-Rolled Coils was moderately lower, with the gap between import and domestic costs having shrunk. Due to this, significant volumes are missing at the ports, and thus, domestic producers' delivery time frames are short, usually around the end of June or the beginning of July. Service centres have claimed to have sufficient stockpiles, but their customers have reported having lower inventory levels. As per ChemAnalyst, companies will not return to buying unless end-user demand comes to the market, and they will have enough stock to wait. If Italian Hot-Rolled Coil prices fall in the coming days, the Hot Rolled Coil's spot price will decrease, further relieving clients.