Though Japanese HRC exporters have managed to avoid very big declines in prices over the past few months, rising availability and strong pressure from other suppliers, from China in particular, have exerted significant pressure on ex-Japan HRC prices. As a result, prices have fallen sharply so far in November and the outlook is not very promising at least for one month ahead.
Prices for ex-Japan SAE1006 2 mm HRC for the Asian region have slipped to $890-950/mt CFR in early November, with the lower end of the range corresponding to the spot offers to Vietnam, while the higher end reflects the official level from one of the major mills to other Asian countries, like Pakistan and Bangladesh. This means that prices have lost $80/mt on average over the past month.
“FOB base from Japan was not below $900/mt for December shipment,” a Japanese trader said, adding that, however, there have been some spot sales at lower levels to regular buyers. For instance, to Bangladesh a trader has sold at $915/mt CFR or so.
The latest official offer to Pakistan from Japan has been at $950/mt CFR, but this level does not reflect the real market for now, sources have said, as offers from South Korea have already been heard at $900/mt CFR Pakistan this week.
In addition, after a long pause, new offers for ex-Japan SAE1006 HRC have been reported to Vietnam - at as low as $890-900/mt CFR, but this price is only for regular customers and on spot basis, taking into account very low-priced ex-China sales lately.
“Some more spot allocation is available depending on the situation, mainly due to lower demand for automobiles driven by the shortage of semiconductors. It is obvious that there are currently more chances and allocations for re-rollers than before,” a market source from japan said.
