Ex-India hot dip galvanized (HDG) coil prices have been maintained at higher levels amid the rising costs of furnace operations and low export allocations, but deals have continued to be stalled by low bids, SteelOrbis learned from trade and industry circles on Thursday, May 14.
Sources said that ex-India HDG (grade Z120) prices have been kept stable at $750-785/mt FOB, while bids have been reported at $700-730/mt FOB, up from $690-710/mt FOB seen a week earlier, but still below sellers’ expected levels, that would offset the higher cost of production.
Furthermore, ex-India HDG (grade Z275) offers in Europe have been reported at $910-915/mt CFR, which translates to around $830/mt FOB, though no deals have been reported so far.
According to the sources, large mills have still been facing shortages of fuel to adequately fire galvanizing furnaces and are under pressure from a government advisory on curtailing energy consumption as the impact of the war in the Middle East deepens across various economic activities.
“The output of value-added products of large mills is limited and is mostly supplied to meet domestic demand. Mills are not willing to push sales overseas unless prices consolidate sufficiently to compensate for the higher cost of production,” a source at ArcelorMittal Nippon Steel Limited told SteelOrbis.
“In our assessment, the minimum price needs to move above $780/mt FOB to ensure cost-plus margins for sellers. Flat product prices are firming up across some key destinations but still not enough for buyers to accept such levels,” another source said.
