Ex-India hot dip galvanized (HDG) coil prices have been kept stable during the past week amid thinning trading conditions in reaction to the softening of price levels in the key Gulf market and uncertainty over ex-China offers due to speculation regarding the export tax, SteelOrbis learned from trade and industry circles.
Sources said that Indian integrated mills have maintained prices at $1,070-1,090/mt FOB, but a few small-volume deals have been concluded at slightly lower levels, which exporters have attributed to the issue of “maintaining a market presence among long-term overseas buyers.”
“Valuations of buyers in the Gulf region are weak owing to low demand. But overall there are uncertainties over whether ex-China offers will be followed through by sellers as there is too much talk over the possible levy of an export tax. Hence, buyers are unwilling to make commitments unless there is clarity in contractual terms. Indian exporters, on the other hand, are unwilling to adjust offers in a hurry in view of the demand revival for flat products in the domestic market,” a source at ArcelorMittal Nippon Steel Limited (AMNS) said.
“There are two opposite pulls in prices. Any export tax on ex-China shipments will put a tailwind to prices. Low tariff quotas in the EU will be a headwind to prices. Buyers are waiting to see which way the wind blows,” he added.
Meanwhile sources said that only one deal has been heard in the market at a discounted price, to ensure a market presence in the Gulf. A western India-based steel mill has reported a trade for 15,000 mt at a price of $1,050-1,060/mt FOB with a Middle Eastern customer, a long standing buyer of the seller and hence able to secure a slightly lower price.