Indian hot rolled coil (HRC) export activity has remained at a standstill with no mill reporting any trade over the past week, after Asian buyers were seeking valuations below the $900/mt mark on CFR basis, but sellers with rejecting such low prices, SteelOrbis learned from trade and industry circles.
A number of the large Indian integrated steel mills were not even submitting offers as they would have to reduce prices to as low as $810-820/mt FOB to meet buyers' valuations in Asia, which would be too sharp a reduction from the levels a week ago at $860-880/mt FOB. At the moment, the lowest price available from India to SE Asia is $840-850/mt FOB, while to other destinations Indian sellers are not willing to go below $880/mt FOB.
“The biggest setback from Indian exports has come from developments in such key markets like Vietnam. Not only has the pandemic situation worsened in the country, there is also a lot of competition from ex-Russia supplies, which are heard at levels of $860/mt CFR [at this level traders are inviting bids for ex-Russia coils, but direct offers ex-mill are higher] in the Asian market. Indian mills are not willing to get into such aggressive pricing,” a source from an Indian mill said. “There had been some buying from emerging markets in Africa and Latin America early in the month which sustained overseas shipments. But these are newer markets and buying from these regions will be sporadic and cannot compensate for the volumes from traditional Asian destinations,” he added.
According to a source in an eastern India-based integrated steel mill, an Asian buyer commenced negotiating a deal for a modest tonnage and the seller was willing to meet a CFR valuation of $900-910/mt, but the deal was turned down when the buyer sought this valuation to be reduced further to levels of $860-880/mt CFR.
“Indian sellers are willing to adjust FOB prices to the range of $840-850/mt FOB, but CFR valuations of $860-880/mt CFR are not viable for any local exporter,” sources at a private steel mill said.