Ex-India hot dip galvanized (HDG) coil prices have been kept stable amid a lot of talk of prices having bottomed out, particularly in Europe, but local sellers have still had to depend on discounted sales to keep trade activity alive. Thus, there has been information about numerous deals signed with European customers this week at discounts, though, according to sources, Indian HDG has “a big quota risk”.
Sources said that ex-India HDG prices have officially been quoted in the range of $780-850/mt FOB, but local sellers were heard to be concluding small-tonnage deals at $735-745/mt net of discounts, lower than discounted sales a week ago at $745-750/mt FOB.
More specifically, according to the sources, an eastern India-based mill reported a trade for around 5,000 mt for delivery to Rotterdam at $732/mt FOB, while another mill concluded a deal for 8,000 mt for delivery to Italy at $740/mt FOB. Furthermore, information that another deal for 12,000 mt was signed by an exclusively flat steel producing mill with the Netherlands-based trading arm of a Japanese steel producer at $735/mt FOB has been circulating in the market. However, it is worth mentioning that none of the deals have been officially confirmed by the time of publication, but, according to sources, “Indian prices look about right and so could work. But there is a big quota risk as the Indian quota for galvanized steel for the last quarter (April to June) of the last quota year was fully utilised on April 1. So, some tons paid 25 percent duty.”
In the meantime, at least two offers were submitted to buyers in the Gulf region, but deals could not be confirmed, possibly indicating that distributors in the region are fully stocked and are unwilling to make fresh commitments, unless materials are deeply discounted.
“There is some optimism coming from talks in Europe of the market bottoming out. But, in reality, EU mills are still dropping prices. Demand is there but importers are very price-sensitive,” an official at a private mill said.
“The problem for foreign suppliers, including those from India, is that European customers are saying they can buy at a better price with less time from European mills,” an international trader told SteelOrbis.
“Our overseas sales for the current quarter (July-September) is that volumes will improve, but the higher price expectations of sellers will have to wait a little longer,” another source at an Indian mill said.