Ex-India hot dip galvanized (HDG) trade has remained almost silent amid the wide offer-bid gap and the few sales negotiations in the Gulf region were called off following irreconcilable differences over meeting logistical challenges, SteelOrbis learned from trade and industry circles on Thursday, July 23.
Sources said that ex-India HDG (grade Z120) offers are quoted in the range of $780-790/mt FOB, but most bids have not exceeded the $740/mt FOB mark.
According to the sources, at least two large mills are heard to have held sales talks for deliveries to Saudi Arabia and the UAE for an aggregate estimated tonnage of 15,000-20,000 mt, but the talks were subsequently mutually called off as logistical and shipping challenges could not be resolved.
The sources with privy to information on the talks said that, while both sellers arrived at a negotiated discounted FOB price, a consensus was elusive on the CIF (cost, insurance, freight)-based sales contracts.
It was pointed out that the risk cost of alternative shipping routes through the Red Sea was assessed as unviable after the recent attack on vessels by the Houthis and so deliveries were considered better to avoid.
A section of traders said that the flare-up of geopolitical uncertainties in the Gulf region and competitive ex-China offers weighed on the success of local exporting mills.
“Geopolitical risks nipped the sliver of hope of a trade revival in the Gulf region. Even low bids are not falling through. We hear some inquiries from Vietnam but deal confirmation is not available,” an official at a government mill said.
“Large mills have low export allocations in the current quarter and can wait for a demand recovery expected at the start of the next quarter in October,” he added.
