Flat steel product imports have continued to show signs of increasing in India during the past week, with the overall softening of ex-China offers, but higher-volume contracts were reported to have been concluded for ex-Japan and ex-South Korea flat steel at premiums by both large steel mills and commercial importers, traders said on Wednesday, October 31.
“The stability of the Indian rupee for most of the last fortnight has helped importers to plan their shipments. Also, the fact that ex-China offers have been steadily softening prompted Indian importers to conclude transactions,” a Mumbai-based trader said.
“However, in terms of volumes contracted, it was observed during the week that importers preferred to conclude contracts for shipments of ex-Japan and ex-South Korea flat steel products. Even at a premium,” the trader added.
According to market sources, ex-China HRC offers have fallen below the $600/mt mark to $595/mt CFR Mumbai, down by $5/mt during the past week. However, most of the import contracts for November deliveries were concluded for ex-Japan and ex-South Korea material.
The sources said that Indian importers have concluded transactions for 20,000 mt of ex-South Korea HRC for late November deliveries at premiums ranging at $15-20/mt on landed basis.
At the same time, it was reported that contracts were concluded for about 15,000 mt of ex-Japan HRC, also at a similar premium range, the sources added.
They said that, while commercial importers have been taking advantage of the steady Indian rupee and the sharp rise in prices of local HRC to conclude transactions, even some large local steel mills have concluded import transactions. Domestic steel mills were resorting to sourcing imported HRC possibly to use the idle excess capacity of their downstream rolling mills, increase downstream production to take advantage of higher earnings from local sales of downstream products.
According to market sources, ex-China CRC offers have moved down by $20/mt to $690/mt CFR Mumbai, but transaction volumes have remained lower compared to HRC as the market is expecting offers to soften further.
However, traders have reportedly concluded ex-China imports of aggregate volumes of around 7,000 mt during the past week.
Ex-China steel plate offers have remained unchanged during the past week at $640/mt CFR Mumbai with only limited contract volumes reported in the market during the past week. Most of the low-volume contracts have been concluded by actual users among state-run thermal power equipment manufacturers as they have been facing difficulties in sourcing boiler grade steel plate from local steel mills, the sources said.