Ex-India hot rolled coil (HRC) prices have remained largely stable, with only a few deals reportedly concluded with additional discounts in Europe. However, a larger section of the market has maintained a negative outlook due to weak demand observed in both the Middle East and the EU, coupled with tight competition with other foreign suppliers.
Sources said that ex-India HRC offers in the Middle East were reported to be stable in the range of $480-500/mt FOB, but no deals were confirmed after buyers were heard to have pulled out of negotiations after failing to secure discounts on the offers submitted by sellers.
Meanwhile, ex-India offers submitted in Europe were stable at slightly higher levels in the range of $540-550/mt FOB, and with some mills reporting relatively higher sales volumes, although fewer in terms of number of trades, this revived market mood somewhat. Last week, an eastern India-based mill reported a trade at $580-600/mt CFR Antwerp net of discount, while another large integrated mill reportedly concluded a trade for 20,000 mt for delivery in southern Europe at $580/mt CFR, net of discount to offer.
In the meantime, a section of the market said that overall trade activity would continue to remain sluggish as the market in the Middle East was heard to be fully stocked amid weak demand, while trade activity in Europe was unlikely to show an uptick in view of weak demand and the forthcoming summer holiday season. Besides, tighter competition with other foreign suppliers in Europe, especially those from Indonesia, will put additional pressure on Indian HRC sellers.
“We are not giving much weightage to the recent deals in Europe as local prices are declining sharply, and Indian sellers will face a challenge in remaining competitive, particularly against ex-China and ex-Indonesia offers. Indian sellers have little leverage to maintain market presence in Europe even as price seeks a lower level,” an affiliate of Tata Steel Limited told SteelOrbis.