Indian hot rolled coil (HRC) exporters have continued to aggressively push up prices and successfully increase them to far above the $800/mt FOB mark in deals to key Asian markets like Vietnam and also to the EU over the past week, SteelOrbis learned from trade and industry circles on Monday, April 5.
At the same time, Indian integrated mills have failed to narrow the price difference between prices to Asia and the EU with the spread remaining not below $100/mt. In Vietnam, the Indian producers were pushing up prices amid a lack of competition, while still tight supply and strong demand in Europe have been supporting realizations to this destination.
Ex-India rerolling grade HRC prices have reached $850-950/mt FOB in deals with the lower end translating to contracts to Vietnam, while the higher end reflects sales to Europe, up by $80/mt on average compared to March 30.
“Overall higher exports realizations will also help producers to increase the base price in the local market,” a steel sector analyst with a Mumbai-based financial services firm said. “The ability of Indian exporters to maintain high prices will depend on Chinese export rebate issues. Our assessment is that ex-China exports will be lower over the next two to three quarters. This will still be a key positive for Indian steel mills to deepen their footprint further in key Asian markets like Vietnam, as buyers will continue to have fewer options of sellers in the market,” he added.
Over the past week, Indian mills have managed to make a few rounds of price increases in Vietnam. Early last week, two Indian mills sold 20,000 mt of HRC each at the level of $840-845/mt CFR Vietnam, which translates to around $805-810/mt FOB, or slightly higher up to $815/mt FOB if the freight rates decline by the end of May.
Also, an Odisha-based integrated steel mill has reported a trade of around 25,000 mt for June shipment with an Asian buyer at a price of around $815-825/mt FOB, the sources said.
But the most recent sales of Indian HRC to Vietnam have already been reported at $880/mt CFR or $845-850/mt FOB. “We are sure that Vietnam will buy at $900/mt CFR and higher,” an Indian producer commented, saying that most mills have increased offers to this level recently.
A few deals from India to Europe has been confirmed at $990/mt CFR, which translates to $940-945/mt FOB, up by a huge $60-70/mt compared to a week ago. New offers to Europe from India are all above $1,000/mt CFR and some sources have already confirmed small sales at $1,000/mt CFR.
No fresh deals have been reported from India to the UAE lately. “The Middle East market is a little slower now as Ramadan is approaching,” a local seller said.