Ex-India hot rolled coil (HRC) prices were kept mainly stable over the past week but mood among exporting mills turned buoyant following revival of buying from the Middle East and expected buying from Europe, once business activity gains momentum later in the week, offering sellers a window to hike prices.
Particularly, ex-India HRC prices have been estimated at $605-675/mt FOB, against $610-670/mt FOB at the end of last week, with the lower end of range corresponding to deal prices in the Middle East, while the higher end corresponds to offers in Europe. More specifically, following several deals for ex-India HRC in the UAE reported by SteelOrbis last week at $635/mt CFR, more deals have been revealed this week for other countries in the Middle East. According to sources, a trade for 20,000 mt of ex-India HRC for Bahrain delivery has been reported at $640/mt CFR while another lot of 15,000 mt was reportedly sold for an Omani steel mill through international trader at $635/mt CFR. Furthermore, an eastern India based mill reported a trade for 15,000 mt for Qatar delivery at $635/mt CFR, though this information has not been confirmed by the time of publication.
“Indian mills are trying hard to increase the prices - even in the local market but are not able to do so as international market is still looking weak,” a market insider told SteelOrbis, adding that “They [Indian mills] may go further competitive in order to book more export orders at least for next 3-4 weeks till Chinese suppliers leave the market for holidays.”
At the same time, some sources believe that export activity may further boost once business in the EU region resumes after the winter holidays but at the same time the optimistic outlook was tempered by almost doubling of freight rates along Indian west coast and Europe maritime route through the Red Sea amid current security risks. Citing an example, an official with a private mills said that enquiries were submitted at $700-730/mt CFR Antwerp but the seller did not get into negotiations owing to ‘unviable ‘ freight rates being quoted by freight forwarding agents.
“The New Year has started on a optimistic note on the export front. But there is an element of caution also. Buyers interest is restricted to specific regions like the Middle East at present. Indian mills have almost totally exited Asian region, in face of ex-China competition. We see buyers’ interest emerging in Europe but rising freight costs are a very strong headwind,” a source in Tata Steel Limited told SteelOrbis.