Ex-India hot rolled coil prices have still been under pressure this week due to the weak local market. Sales have been limited and still only at discounts as the local market was in oversupply zone and prices under pressure, while in other Asian markets the downtrend has continued as well.
The SteelOrbis reference price for ex-India HRC has been settled at $515-580/mt FOB, the lower end of the range has corrected down by $5/mt over the week. The lower end of the range is corresponding to the levels in Vietnam, while the higher end represents the offer level for Europe, though the market has been still frozen in the latter, expecting new measures to be announced on July 1. Some mills were still asking for $550/mt FOB for non-EU destinations, but this level has been assessed as fully unworkable and trades have been limited even after discounts. “Mills are going for large volume export orders aggressively,” a trading source said.
Citing an example, some market sources said that an eastern India-based mill reportedly was successful in concluding a sale of 30,000 mt for delivery to the Gulf at a price of $540/mt FOB, $5-10/mt below the trade level to the same destination reported two weeks back.
Another large mill was in negotiations in Southeast Asia but there has been no confirmation of a deal being done. Mills try to stay at $520-530/mt FOB. But today, the offer price from India has been heard at $545/mt CFR Vietnam, which translates to $515/mt FOB. But even though this level is the most competitive in the market in Vietnam at the moment and last week Indian offers were at $555-560/mt CFR at the lowest, there has been no confirmation that a deal was done. “Vietnamese buyers are resisting purchasing at any price now as they see the market is still falling,” a Vietnam-based source said.
“Ex-China offers still remain very competitive. More volumes can be expected to start entering trade flows as geopolitical restrictions ease in the Gulf as expected. A clearer trend will be seen once bookings for September-October deliveries commence,” an official with a large trading firm in India said.
“Indian mills can also be expected to increase export allocations during the July-September quarter, in response to the local sales slowdown and higher-than-normal inventories during lean monsoon season demand,” an Indian trader added.
