Ex-India hot rolled coil (HRC) prices have continued to be lowered by mills, but still most of them [mills] have been struggling to secure new deals given the continuous pressure from lower bids from buyers. Thus, a further decrease is expected in the new round of sales given the bearish sentiments globally and in the local market in India.
Sources said that exporting mills have dropped their HRC prices by an average of $15/mt to the range of $565-600/mt FOB, with the lower end of the range corresponding to offers and occasional deal prices in some countries of the Middle East region, while the higher end corresponds to offers in Europe where customers have kept insisting on discounts.
More specifically, a deal for 3,000 mt was heard in the market from an eastern India-based mill for delivery to Bahrain at $565/mt FOB. Besides, according to sources, following several deals for ex-India HRC in the UAE at $625-630/mt CFR (or around $588-595/mt FOB) last week, talk about a new booking at $605/mt CFR, which translates to around $568-570/mt FOB, has been circulating in the market this week. “This deal at $605/mt CFR is certainly not a direct sale from a mill but from a stockist who is selling old stock at this price,” the representative of an Indian mill told SteelOrbis.
Furthermore, another trade for 3,000 mt of HRC with a Singapore-based buyer has been reported at $570/mt FOB, but at least two market participants not associated with the deal claimed that the final contract price was at a $10/mt additional discount.
Offers from India to southern Europe have been reported at $645-650/mt CFR, down by $20-25/mt week on week, though, according to most buyers, ex-India offers have remained uncompetitive at the moment against ex-Southeast Asia HRC offers.
“Volatility in futures in China is taking a toll on global sentiments. Buyers with numerous sourcing alternatives are seeking discounts on even very small tonnages. Indian sellers are seeking a sharp erosion in competitiveness,” an official at a government mill said.
“Basically, Indian flat products do not enjoy any attraction for buyers. Most mills are only marginal players in exports now. I would even say that exports at current prices result in negative margins for most local mills,” he added.
