05/09/2025 17:03:06 UTC|News
Author Fast Webs<“>.>, Charles Thompson<“>.>|EN

* Downstream demand weakens amid quota, tariff uncertainty
* Interest in imports also weakens
* Sources show concern over a lack of CBAM clarity

Uncertainty was the dominant theme at this year’s Made in Steel trade fair in Milan, Italy, as Europe’s flat steel market grappled with weak demand, volatile trade dynamics, and mounting regulatory complexity.
As the steel industry gathered in Milan May 6-8 for the trade fair, market participants shared largely bearish outlooks for the flat steel pricing trajectory and expectations for the continuation of poor near-term demand visibility.
Despite the recent trend of increased mill offers across Europe, many attendees noted that regulatory uncertainties and a lack of concrete activity have kept prices under pressure.
The fair has been quite muted so far. Sentiment is generally negative, a Southern European mill source said. There’s a lot of uncertainty—quotas, tariffs, the situation with the US—all of it is complicating things.
But some sources noted more positive signs.
A German stockholder expressed optimism that a ceasefire in the Russia-Ukraine conflict and increased infrastructure spending under the incoming German government could help lift demand. We’re hopeful this will improve sentiment in the second half of the year, the stockholder said.

Imports are under pressure

Although European import quotas have seen mixed allocation rates across hot-rolled coil, cold-rolled coil, and hot-dipped galvanized steel, sources at the fair offered mixed views on price viability and buyer receptiveness to the different origins.
Numerous sources cited an influx of Indonesian coils, with offers heard during the fair at Eur 570/mt CFR Italy. Whether the material was workable for the wider market or more suited for piping applications remained a key area of debate.
Discussing the feasibility of imports in general, and the reduced uptake of the quotas, one trader referred to an atmosphere of uncertainty, partially due to buyer hesitancy in the first quarter during the European Commission’s safeguard review, with the impact still being felt. Similarly, looking forward, he said, Buyers booking imported material from Asia are trying to delay for a few weeks to see what domestic prices and end-consumers are doing.
But any material that is ordered now won’t arrive until after summer; nobody has any demand visibility that far out, and they don’t want to take the risk.
Despite the South Korean import quota for HRCbeing exhausted during the fair, market reactions remained muted. Many recognized that domestic availability in Northern and Southern Europe remained strong.
It is a buyers’ market, said a second trader, who anticipated that domestic HRC offer levels will drop by Eur20-30 in the coming weeks.
We would like to see higher prices, but there is not a lot of business, and a lot of competition at the moment [among] service centers,” a service center source said. “We are very curious where mill margins are, as they will struggle to drop prices.
The same source also pointed toward short-term demand visibility as significantly affecting market confidence, reporting that some customers were asking for small, additional volumes at the last moment, limiting the ability to do forward planning.

CBAM uncertainty looms

The EU’s Carbon Border Adjust Mechanism continued to polarize the market, with many arguing there was a continued lack of clarity or transparency on the emissions reporting mechanism or the potential price impact it will have.
Several market participants anticipated a price increase, citing the additional administrative burden following a shift in preference for customs-cleared material versus CIF cargoes and metal from origins with lower default values. However, the absence of EU-declared benchmark/threshold emission values and a corresponding benchmark carbon level for each production pathway remain common criticisms.
More broadly, sources suggested that the legislation was adding an additional layer of uncertainty, with confusion over how CBAM can be hedged and how the additional cost burden was coming at a moment when the market was under considerable cost pressure across the supply chain.

Cautious outlook

While some fair attendees held out hope that Made in Steel would bring fresh momentum to the market, most agreed that visibility remained limited and pricing pressure was mounting, especially on the domestic side.
We’ll reassess after the fair, said a buyer. But the market feels cautious. Unless something shifts, we may see prices heading down.
Market participants pointed to persistent uncertainty around trade policy, muted demand, and regulatory developments as key themes shaping the outlook for flat steel in the coming weeks and months.