Indian export offers for hot dip galvanized (HDG) coils have edged down by $5-10/mt during the past week to around $845-855/mt CFR US, but have failed to evoke any interest among buyers who have remained cautious due to the continuing decline of flat product prices in North America, traders said on Thursday, March 5.
According to a Mumbai-based trader, the adjustments in HDG offers by Indian exporters are considered to be small in comparison to Chinese exporters who are accepting far sharper cuts in offers in order to push volumes.
The trader said that US imports of HDG increased by between five and seven percent during the December-February period and, with the continuing downtrend of flat steel prices in the US, distributors have become cautious about concluding new bookings in order to avoid an inventory buildup.
According to the trader, even for small transaction volumes, US distributors prefer ex-China HDG, which is at least $25-35/mt lower than Indian offers on CFR basis.
Market sources said that Indian steel mills and exporters are awaiting firm signals from the Reserve Bank of India (RBI) to persist with buying up US dollars to limit the appreciation of the Indian rupee.
On Wednesday, March 4, the RBI started mopping up dollars from the market and the rupee weakened to levels of INR 62.26 to the dollar and sources said a further weakening to levels of INR 62.80-63.00 to the dollar would enable local HDG exporters to further adjust offers in order to push higher volumes overseas.