Ex-China flat steel offers to India soften but fail to attract buying interest

Wednesday, 10 April 2019 14:30:02 (GMT+3)   |   Kolkata

Ex-China flat steel offers to India have softened during the past week but have failed to attract any significant transaction volumes as trading activity has come to a virtual halt with the national elections getting underway on Thursday, the shortage of working capital available to importers, and the sluggishness of demand, traders said on Wednesday, April 10.

“With the election season and political uncertainties peaking, market participants are unwilling to make any kind of commitments right now,” a Mumbai-based trader said.

“There are no clear frontrunners in the elections, voting for which starts tomorrow. Market participants are wary of the possibility of no political party securing a clear majority to form the next government and the markets do not like such prospects of instability. Traders are also facing a lot of difficulty in securing working capital approvals from lending institutions, forcing them to be cautious in committing their own funds,” the trader added.

A section of the market has also attributed the lack of appetite for imports to the slowdown in manufacturing sector growth and actual users becoming stricter in their raw material inventory management, and hence intermediaries are also lowering their stocks and avoiding fresh bookings.

These market participants said that even marginal volumes contracted during the past week by a few commercial traders have been solely for re-export purposes to neighboring countries and to meet previous shipment commitments to buyers in these markets.

Ex-China HRC offers to India

Ex-China hot rolled coil (HRC) offers have moved down by $15/mt during the past week to $573/mt CFR Mumbai, according to market sources.

The sources said that not more than a combined 4,000 metric tons were contracted by two traders, reportedly for re-export to neighboring Nepal.

Ex-China CRC offers to India

Ex-China cold rolled coil (CRC) offers have decreased by $10/mt during the past week to $590/mt CFR Mumbai, according to market sources.

However, despite lower offers no transaction has been reported in the market by either domestic steel mills or traders, the sources added.

Ex-China plate offers to India

According to market sources, ex-China plate offers have moved down by $10/mt week on week to $635/mt CFR Mumbai but no transactions have been concluded in the given period.

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