Indian exporters of hot dip galvanized (HDG) coils have attempted to marginally push up offers by $5-10/mt over the past week to the range of $795-800/mt CFR US, amid rising flat steel product prices in the US, but transactions for higher volumes have been concluded at slightly lower price levels, traders said on Thursday, January 21.
"US domestic steel mills have increased flat product prices during the week, giving Indian HDG exporters a window to try to push through higher offers," a Mumbai-based trader said.
"However, US buyers have been cautious and Indian exporters have been able to conclude transactions for higher volumes only after offering discounts of around $10/mt," the trader said.
"US importers are aware of the sharp fall of the Indian currency and are pushing hard bargains and, with discounts holding the key to successful transactions, the higher offer levels have existed only on paper," the trader added.
The Indian rupee during the past week has continued on a free fall, hitting a 28-month low at INR 67.95 to the US dollar.
At least two other traders have said that reports in India indicate that there are uncertainties whether US steel mills will be able to maintain their higher prices and, with US steel distributors/importers seeking discounts following the fall of the rupee, Indian HDG export offers will have limited upside potential.
However, if the rupee consolidates at weaker levels than INR 68 to the dollar as most currency dealers anticipate, Indian exporters will be in a position to aggressively lower offers by around $15-20/mt to push through transactions for larger volumes to the US, the traders said.