Prices in the north-western European coil market are likely to rise further going forward, or at least maintain their current level, most market players believe.

Some sources at stockholders continue to be cautious. They say that prices have not moved much since January and that the target of €500/tonne ($541/t) ex-works for hot-rolled coil given by a major mill is not within reach. Against that, one other mill claims that it is already signing deals at that price level and higher. For April-delivery orders in late January/early February, contracts were closed at €470-490/t, a sales source says.

Sources among buyers do not confirm this immediately, but do concede that “… €500 certainly doesn't seem impossible in the long term. The order books seem to be well filled, as some mills have left the market since mid-February,” a Dutch manager tells Kallanish. He adds that mills are taking a very firm stance when negotiating new contracts for deliveries in the second quarter. “The majority of our network shares the view that prices will certainly not fall, may remain stable, but are more likely to rise rapidly,” he says.

A buyer at a German cold-roller confirms that mills are keeping their price offers high, and that order activity for the second quarter is busy. “The mills are feeling as if they are on cloud nine at the moment,” he says.