<article><p class="lead">Traders expect that an anticipated supply squeeze from September onward in the domestic Italian hot-rolled coil (HRC) market, amid ongoing issues at a major steelmaker, could support domestic prices.</p><p>Market participants expect reduced production from the mill to spark a price increase, and service centres' recent destocking phase could play into this as they start to buy again.</p><p>The possibility of the seller stopping or cutting output substantially saw pipemakers book large orders last week from Egypt, India and Turkey at €460-465/t ($513-518/t) cif Italy, mostly for September-October shipment. Smaller volumes were booked in the €470-475/t range.</p><p>Uncertainty about the safeguard measures in Europe — many expect the HRC import quota to be changed from a global to country-by-country allocation — is also likely to change the supply dynamics.</p><p>But not all buyers are convinced a price increase will materialise later, and destocking continues. Some sellers have started to cut September rolling/October delivery pricing because of slack demand.</p><p>And any potential availability issues in Italy later this year could be eased by supply from elsewhere in Europe, given the oversupply in the marketplace. Service centres in northern Europe are not buying, and are still turning steel into cash and keeping a close eye on working capital.</p><p>The <i>Argus</i> daily Italian index nudged up by €0.25/t to €448.50/t ex-works, while the northwest EU index was stable at €470.50/t ex-works.</p></article>
