Ex-India hot rolled coil (HRC) prices have remained relatively stable over the past week, though some downward pressure has been observed in discounted deals across Asia and the Middle East. In contrast, offers for ex-India HRC in Europe are about $50/mt higher than in the Gulf region and Asia, while Indian suppliers still have room to secure additional contracts as only half of the July-September EU quota has been filled so far.
Specifically, official offers from large Indian mills have been kept unchanged in the range of $505-515/mt FOB in the Middle East, which translates to around $535-540/mt CFR UAE, the same as last week, while a few offers are still reported higher at $540-550/mt CFR UAE.
However, the sources said that a few trades for relatively small volumes were confirmed in the region after both buyers and sellers reached a compromise in bridging the bid-offer gap, indicating an improvement in demand but buyers are still resisting accepting higher prices. In particular, an eastern India-based mill reported a trade for 8,000 mt for delivery to Qatar at $500/mt FOB, which was less than the $520/mt FOB offer submitted initially by the seller but more than the $480-490/mt bid from the buyer. Similarly, another deal was reported by a second large mill for an estimated tonnage of 15,000 mt for delivery to the UAE at a final contract price of $490/mt FOB, against an initial offer of $515/mt FOB and a first bid at a low of $480/mt FOB, the sources said.
Furthermore, according to market insiders, one of the Indian steelmakers has also returned with new offers to the Vietnamese market. Specifically, offers have been voiced at $515-519/mt CFR Vietnam, while a deal for around 30,000 mt was reported at $507/mt CFR last week, for November shipment. This means ex-India HRC offers have settled at around $495-500/mt FOB in Vietnam.
In the meantime, ex-India HRC offers in Europe have been voiced at $605-610/mt CFR, up by $5/mt on the lower end of the range week on week, which translates to around $550-555/mt FOB. According to sources, in Europe concerns over possible quota exhaustion have kept some buyers away from imports. Still, Indian suppliers have room to sign new deals, as SteelOrbis’ EU quota tracking system showed that by September 12 they had used only 52 percent of the 227,781 mt quota for the July-September period.
Thus, the SteelOrbis reference price for ex-India SAE1006 HRC has moved to $490-555/mt FOB, from $505-555/mt FOB at the beginning of last week.
“It is getting clearer that demand in the Middle East is improving but buyers are still bargaining hard. The positive is that both buyers and sellers are willing to compromise on a workable price and trade volumes are improving although at low volumes,” an official at Jindal Steel Limited told SteelOrbis.
“The market conditions are such that Indian mills are cautious in pushing sales overseas as opportunities to secure better margins are still a challenge. Export sales will remain a function of inventory management and hence mills’ export allocations will remain on the lower side unless price realizations consolidate upward of the $540-550/mt FOB mark,” he added.
