Indian hot rolled coil (HRC) export offers have increased over the past week, though the latest contracts were signed at the previous level, SteelOrbis has learned on Monday, December 16. Large domestic steel mills have taken a pause from concluding new export bookings, waiting to finalize their export pricing after base price increases in the local market.
Offers for ex-India HRC from mills have increased to as much as $465-475/mt FOB for February shipment, as producers are not in a hurry to sell abroad, expecting a reduced allocation because of the stronger domestic market. At the same time, the latest deals have been done in the range of $445-450/mt FOB, the same as previously.
The traders said that local steel mills will have to factor in higher domestic per ton margins from HRC, the Indian rupee appreciating above the INR 70 to the dollar mark, while determining export volume allocation and prices in January 2020, and hence the lull in export trades during the past week.
Most of the export contracts concluded during the past week were low volumes with buyers in Vietnam and Malaysia. Market sources said that a western India-based steel mill concluded a HRC contract for early February delivery of around 15,000 mt at the higher end of the offer range of $447.50/mt FOB. A contract for a relatively low volume was contracted by an eastern India-based private steel mill for end-of-January delivery of 10,000 mt at the lower end of the range at $445/mt FOB.
The sources said that large mills are now looking at March delivery bookings but firm contracts will only be concluded after these mills have completed their new export pricing regime and export volume allocations for March over the next few weeks.
New offers for ex-India HRC from mills have been made to Vietnam and to the EU, two major sales destinations for India, at $500/mt CFR, but customers are not ready to accept such prices yet.