Indian hot rolled coil (HRC) exporters have dropped offer levels, but sales volumes have not increased much with buyers having alternative cheaper ex-China options for sourcing, SteelOrbis has learned from trade and industry circles.
Ex-India HRC offers are reported at $800-850/mt FOB, mainly with the higher end of the range slipping by $70/mt, from $880-920/mt FOB settled late last week. Though some offers by Indian mills to higher-priced markets are still at $900/mt FOB or so, some rare definite trades are possible only at close to $800-820/mt FOB net of deep discounts by sellers, while some customers have already voiced bids at $750/mt FOB.
The sources said that a lot of ex-China material has been on offer in different outlets below the $800/mt FOB mark, leaving Indian mills with little option but to add discounts to already lower export prices to conclude deals where buyers are scarce and inventories rising across the local market.
“Ex-China competition is getting very aggressive and strong. We do not think India mills have the cost structure to match their competitiveness and drop offers below the $800/mt FOB mark. At least not if inventories rise to uneconomical levels,” an official at a private mill said.
“The only positive being that realizations from sales in the Gulf are ensuring slightly better realizations than sales in other regions. But volumes are still low as Gulf demand is not very strong either,” he said. He cited examples of trades in the Gulf fetching around $850/mt FOB or slightly above for July shipment.
At the same time, offers from India to Vietnam have still been at $850/mt CFR (translating to $800/mt FOB), but buyers have been bidding at $790/mt CFR for the market from the major Indian producer. “Currently, Indian suppliers can accept to sell at $850-870/mt CFR. If there's a lower bidding, they will give up,” a source from Vietnam said.
Also, an offer to Europe has been reported at $1,000/mt CFR or €960/mt CFR, which is around $900/mt FOB. But the tradable level heard in the market was $800-820/mt FOB for sales to Italy, sources have said.
Several trade sources said that overseas sales information mill-wise is not readily available in the market currently. It is reckoned that mills are not disclosing export details as deep discounting is so widespread and competition even for low-volume deals so aggressive that sellers are not willing to give out details or estimates of discounts offered to conclude deals.
