Indian exporters of hot dip galvanized (HDG) coils have kept their offers stable at the higher level of $795/mt CFR US during the past week but have been seen to be offering discounts ranging at around $15-20/mt as transactions volumes have increased triggered by the rise in US domestic flat steel product prices, traders said on Thursday, January 28.
"Most of our buyers are reporting that US steel mills are hiking flat product prices. This has led to a significant rise in the number of transactions and volumes for Indian HDG," a Mumbai-based trader said.
"Several exporters have needed to offer discounts to clinch deals, but this was facilitated by the Indian rupee consolidating at levels weaker than INR 67 to the US dollar," the trader added.
However, some market sources have cautioned that it is still not certain whether US steel mills will be able to sustain higher flat product prices and possibility of the US increasing import duty on flat products is an immediate threat to improved HDG export sentiment in the Indian market.
At the same time, sources said that overall demand for Indian HDG in Gulf Co-operation Council (GCC) markets has diminished over the past two months amid the overall impact of falling oil prices on economic activity in the region.
The sources said that Indian offers in the range of $460-480/mt CFR Gulf have failed to find buyers of any significant volumes.