Ex-India hot dip galvanized (HDG) prices have softened significantly in line with the bearish steel price trend in most markets, but market participants have remained divided over the short-term trend and outlook, SteelOrbis learned from trade and industry circles on Thursday, April 13.
Indian integrated mills have cut HDG prices to the range of $900-1,000/mt FOB with the midpoint at $950/mt FOB, lower than $960-1,010/mt FOB a week ago, with producers and traders maintaining widely divergent views on causes and outlook.
A section of officials at mills hold a positive view saying that the fall in trading activity and prices was “seasonal” and due to low business activity during Easter and Ramadan, and that improvements would be noticed over the next few days once businesses resume after the holidays.
However, others have maintained a more bearish stance claiming that market dynamics have changed and that the upturn in trade volumes and prices, led by Europe over the past several weeks, has run its course and key overseas markets would not seek a new bottom.
They said that the deepening weakness in demand and prices in China risks a contagion effect in other regions and that domestic mills would face headwinds in pushing volumes overseas as is evident in the steadily falling volumes seen over the past fortnight.
Among the stray deals confirmed in the market over the past week was a deal concluded by an eastern India-based integrated mill for end-of-May shipment to an Asia-based trading firm at $922/mt FOB, sources said.
A western region-based mill has reported a sale of 8,000 mt for South Africa delivery at $900/mt FOB, the sources said.
“The market is subdued with few buyers and sellers active. Everyone in on wait-and-watch and the market can move in either direction going forward. The mood definitely is getting bad,” an official at a private mill said.
“Indian mills still have significant price competitiveness. But will it continue to be so against the weakness in China is the moot question. Possibly the domestic market will regain focus for producers,” he said.
