Ex-India hot dip galvanized (HDG) coil trade has continued to remain inactive with sellers maintaining prices stable despite the widening gap with falling bid levels, SteelOrbis learned from trade and industry circles on Thursday, July 14.
Indian mills have declined to make any changes in offer prices at $970-990/mt FOB, even though bids have been as low as $870-900/mt FOB largely owing to the fall in ex-China prices and prices in the US market.
The lack of activity has also been compounded by the slow pick-up in business in the Gulf region, a key destination for Indian sellers, after the recent holiday.
“The fall in price of flat products across the US and the EU has eroded the price competitiveness of Indian sellers. Indian mills face a lot of challenges in reducing offers to the $900/mt FOB mark to bridge the spread with current bids received,” a source at ArcelorMittal Nippon Steel Limited (AMNS) said.
“In terms of cost structures, following the rapid fall in price of flat products, the difference of margins between benchmark hot rolled coil (HRC) and value-added products like plates and HDG has narrowed by around 50 percent over the past six months. Hence, mills have very little room to cut selling prices of HDG to be able to push sales overseas, with the additional burden of the 15 percent export tax,” he said.
