Indian export offers for hot dip galvanized (HDG) coils have been stable in the range of $830-840/mt CFR US during the past week but transaction volumes have remained restricted in the same period, with buyers unsure about the flat product price rise seen in north America, traders said on Thursday, July 16.
"Several buyers we talked to said that they are not sure if the current rise in US flat product prices will be sustained or not. They are waiting for higher levels of stability before concluding large import transactions," said a Mumbai-based trader.
"It has been learned that US HRC prices are under pressure but HDG prices are holding out and buyers are awaiting a clear direction before making fresh bookings," the trader said.
"At the same time, Indian HDG exporters have maintained their offers unchanged and refrained from adjusting their prices in order to push volumes, unsure how their domestic costs of production would play out in the short term and also unsure of the direction of the Indian currency," the trader added.
A section of sources said that local exporters have been caught in a bind in their export pricing by the Indian rupee moving in both directions within a narrow range during the past week.
Indian market participants are still to gauge the impact of the Chinese market stock meltdown, China's aggressive HDG export pricing, the Greek crisis and its impact, and the vulnerability of the Indian rupee, the sources said.
Without an immediate demand uptick in the US, the Indian rupee will need to stabilize closer to INR 64 to a dollar from the current level of INR 63.41 before Indian exports will consider a $10-15/mt downward adjustment in HDG offers, a Mumbai-based trader said.