Ex-India hot rolled coil (HRC) prices have softened slightly and, though trade activity has remained healthy, there was an increasing pessimism over further upside gains from the current levels, SteelOrbis has learned from trade and industry circles. Moreover, though sales prices to Europe have remained mostly stable, a level a bit lower has been fixed in trades in the Gulf region.
While trade activity has remained positive, average ex-India prices have ranged between $680-730/mt FOB, with the midpoint at $705/mt FOB, lower than $700-740/mt FOB a week ago.
The higher end of the range still corresponds to sales to Europe. In particular, a few sources confirmed deals at €745/mt CFR Spain or $796/mt CFR at the current exchange rate, versus $800/mt CFR in small contracts to Italy last week. This level translates to around $730/mt FOB. Most offers for ex-India HRC to Europe have been fixed at $790-800/mt CFR, and, though this is slightly below $800/mt CFR and even above heard last week, most sources do not assess this as a correction. Market sources said that “only small volumes” were traded at $800/mt CFR last week, and in general Indian mills were aiming to keep selling to Europe.
Another supply contract has been reported for ex-India coils with a UAE buyer at $685/mt FOB for a tonnage of over 10,000 mt. The CFR price in the deal has been assessed at $715-720/mt CFR.
Another Odisha-based mill has reported a deal for delivery to the Gulf at $688/mt FOB for a 5,000 mt tonnage, market sources said, though no further details have been available.
The indicative price level for ex-India SAE1006 HRC in Vietnam has been at $700/mt CFR or $680-685/mt FOB, though some mills are still asking higher, not being willing to sell to this destination.
Another supply contract for a small volume with an Asian trader has been rumored at $683/mt FOB, sources said, but this material is unlikely to go to Vietnam, at least in the near future, as buyers have better prices from China.
“Demand in key overseas markets remains robust. The only change in that buyers, particularly in Europe, are not willing to accept higher prices. The market is getting price-sensitive,” an official at a private sector mill said.
“For now, $700/mt FOB seems to be the generally achievable price realization and, while it is still healthy, euphoric expectations of it surging much further are drying up. It is settling at realistic levels,” he said.
