Ex-India hot rolled coil (HRC) prices have mainly been maintained changed by local mills, but have remained under significant downside risks because of negligible trades and amid market speculation of a few booking cancellations by EU buyers over the past week, SteelOrbis has learned from trade and industry circles.
Ex-India HRC prices are unchanged at $900-950/mt FOB, but even the return of business activity in the Gulf after the holidays has not triggered any revival in trading interest. Buyers have been waiting for Indian suppliers to offer at $850-880/mt FOB.
“Export trade sentiments and the price outlook suffered significant hits from a lot of talk that two exporting mills have faced booking cancellation from buyers in Spain and Italy after facing issues of opening of letters of credit. Though neither the buying or selling sides confirmed this, speculative reports indicate present vulnerabilities in key export destinations,” two sources in trade circles averred.
“HRC prices are on a downslide across the EU and the US and there is a lot of ex-China material on offer in these regions. Ex-India HRC has lost a lot of comparative advantage in these destinations and, with buyers in the Gulf also limiting trades to very small volumes, Indian mills face considerable inventory pressures,” the trader said.
Offers to Turkey and the UAE have been heard at $950-960/mt CFR, translating to around $900/mt FOB or just slightly below. But since there are offers from China at almost $50/mt cheaper, buyers have been reluctant to purchase from India.
An official at a private Indian mill said that, as export offers are submitted for July-August deliveries to EU buyers, it remains to be seen if exporters can bring down prices to $850/mt FOB. The tradable level for different origin HRC to Europe was equivalent to $910-930/mt FOB last week, while currently customers are waiting for a further drop to restart fresh buying.
