Ex-India hot dip galvanized (HDG) coil prices have continued their consolidation spurred by the hardening of local prices in the US and the EU, but Indian mills have been hamstrung in leveraging the bullish market conditions given the limited volumes for overseas sales.
Ex-India HDG prices have been quoted in the range of $910-950/mt FOB, compared to $900-920/mt FOB a week ago with some reports even quoting them at $1,010/mt FOB, though most industry sources and market intermediaries have maintained that deals at the higher end of the range did not materialize as sellers were not able to confirm the volumes being sought by the EU buyers.
Sources said that the average deal size during the past week did not exceed 10,000 mt, which was very low compared to the robust demand across key markets. Buyers were willing to accept higher prices but not for low volumes which did not match their economies of scale, but local sellers did not have sufficient exportable volumes.
An eastern region-based integrated mills reported concluding a trade for 3,000 mt for early April shipment to Egypt at around $930/mt FOB and another tonnage at $910/mt FOB for the UAE.
A Gujarat-based mill has concluded a deal for 5,000 mt at $920/mt FOB with an undisclosed buyer, the sources said.
“Mills across the US and the EU are seeking to increase flat product prices. But there is still a lot of unmet demand in the Middle East, West Africa and the EU,” a source at the Indian mill said.
“Ex-India prices are very competitive. But in global markets you need to have adequate volumes on offer to secure supply contracts. The confidence of the buyers is of prime importance. High prices are acceptable but not cuts in offer volumes or extensions of delivery commitments. Indian sellers do not have sufficient export volumes at the year-end. Output of saleable steel and export allocations will improve from mid-April onwards,” he said.
