Ex-India hot dip galvanized (HDG) coil prices are unchanged on FOB basis, but no deals have been reported amid the combination of holidays in key destinations like Europe and the uncertainty mounting over the surge in freight rates, translating to CFR prices which are unviable for buyers, SteelOrbis learned from trade and industry circles on Thursday, December 28.
Sources said ex-India HDG prices have been kept stable in the range of $830-870/mt FOB, but the surge in freight rates on the western Indian coast maritime route via the Red Sea translates to prices on CFR Rotterdam basis as high as $970-990/mt, compared to around $920/mt CFR a week ago, and this is reported to be unviable to most buyers in the current market conditions.
At the same time, according to market insiders, while freight rates along the maritime route through the Red Sea are not even being quoted by most freight forwarding agents, higher freight rates were quoted for shipments around the Cape of Good Hope at the southern tip of Africa. But neither the higher freight rates nor the longer 15-20 day delivery timelines are acceptable to sellers or buyers, the sources said.
At least two officials at large Indian integrated mills said that much of the optimism over improved HDG prices, particularly in the EU region in the New Year, has been dissipated by the unforeseen developments on freight rates and uncertainties over shipping timelines. They said that, unless the global coalition ensures higher security on international waters, the rising freight and insurance costs would prevent Indian mills from leveraging the improved demand and prices in the key European markets.
