The uptrend in the global hot rolled coil (HRC) market has remained strong this week. Chinese exporters have increased their offers before closing for the Chinese New Year holiday (21-27 January), encouraging bullish sentiments in the region. In India, prices have been reported at a six-month high and, according to market sources, deals at higher prices have been successful or possible mainly in the Gulf and the EU regions. At the same time, though demand in Turkey and Europe has been rather slow, offer prices in these outlets have also continued to post rises.
In China, the last week before the Chinese New Year holiday, the HRC market mood has kept improving amid the stronger national currency and the strongly optimistic outlook for the post-holiday period. Thus, although most Chinese HRC suppliers have refrained from new export offers, several producers who remained in the market have decided to go higher, announcing their export offers for boron-added SS400 HRC at $640-650/mt FOB, with a midpoint at $645/mt FOB, moving up by $20/mt compared to January 10, and up by $17.5/mt since Friday, January 13. Meanwhile, by the end of the week, the tradable price level for SS400 HRC has been heard at $630-640/mt FOB, versus $620-635/mt FOB at the beginning of the week, and up by $30-35/mt week on week. Offers for ex-China SS400 HRC to the Middles East have been voiced at around $680-690/mt CFR, versus $650-660/mt CFR last week. Ex-China offers for Q125 HRC in Turkey have settled at a minimum of $675/mt CFR, up by $25/mt week on week, but, according to sources, “the price idea of Chinese suppliers is at $690/mt CFR and higher for both the Middle East and Turkey.” During the given week, local HRC prices have decreased by an average of RMB 5/mt ($0.74/mt) compared to January 13 to RMB 4,110-4,230/mt ($606-624/mt) ex-warehouse on January 20, according to SteelOrbis’ data.
Ex-India HRC prices have been reported at a six-month high with local mills successful in concluding some deals at higher levels, while the return of buyers from the EU region to the market after the holidays was also a positive sign. Ex-India SAE1006 2mm HRC reference prices have reached $630-680/mt FOB by the end of the week, up from $620-630/mt FOB a week ago. The lower end of the range ($630-645/mt FOB) corresponds to some deals done over the past week, while the higher end of the range represents the tradable level for ex-India coils to Europe, which is the highest-priced market nowadays. A few Indian mills have submitted their latest offers starting from $660/mt FOB to most sales destinations, but whether these were converted into deals could not be confirmed, but they reflect the bullish sentiments on overseas sales.
In Vietnam, prices for import HRC have increased further, and, although trade activity has been limited this week as most companies have left the market for the holiday, the uptrend of import prices is expected to persist given the bullish mood of most main exporters. In particular, Chinese suppliers have increased their offers for SAE1006 HRC to $660-675/mt CFR Vietnam, up by $10-15/mt week on week, while offers for SS400 HRC have been voiced at around $640-650/mt CFR, versus $630/mt last week. Meanwhile, offers for ex-India SAE1006 HRC have been voiced in Vietnam at a minimum of $660/mt CFR, with no deals reported so far. Offers for ex-Japan HRC have settled at around $670/mt CFR this week. Thus, the SteelOrbis reference price for import SAE1006 HRC in Vietnam has increased by $10-20/mt over the past week to $660-670/mt CFR.
HRC prices in the Turkish domestic market have increased by $20/mt over the past week, boosted by the decent sales closed previously and also owing to less aggressive import offers. By the end of the week, Turkish mills have been offering HRC at $740-760/mt ex-works domestically and at around $710-740/mt FOB for export. Business activity has been slow since locally buyers have restocked somewhat, while as for exports the EU still does not find Turkish prices attractive and has preferred to book from elsewhere, particularly from Egypt. In the import HRC segment in Turkey, China has left for its holiday with the latest offer voiced at $680-690/mt CFR, up $10-15/mt over the week. Offers from South Korea and Indonesia have stood at $700/mt CFR and $720-740/mt CFR, respectively. Vietnam has been negotiating at $680/mt CFR, while India has been offering at around $685-700/mt CFR depending on the supplier. Russian mills have not been actively offering this week, but the indicated level is at $670-680/mt CFR from a sanctioned producer and at around $710-720/mt CFR from a non-sanctioned mill.
Most European HRC producers have kept testing the market with further price increases given their low availability. In particular, HRC offers from European mills both in the south and north of the region have been evaluated at €750/mt ex-works, though the tradable price level has been reported at €730/mt ex-works. This means that the price level has increased by €30/mt on average week on week. At the same time, despite still limited demand from end-users, more price hikes for April shipment HRC are expected in the coming weeks and, according to sources, most producers are aiming for another increase to €800/mt ex-works. Meanwhile, most import offers have remained relatively stable as compared to last week, standing at €680-710/mt CFR, depending on the origin. The lower end of the range corresponds to offers for ex-India and ex-Egypt HRC, which have been voiced in southern Europe at $735-740/mt CFR, or around €680-685/mt CFR. Besides, according to market sources, around 20,000-25,000 mt in total of ex-Egypt HRC have been sold to Italy at €678-680/mt CFR and to Spain at €683-685/mt CFR, up by €10/mt week on week. Offers from other Asian suppliers, like those from Japan and South Korea have settled at €705-710/mt CFR Italy and Spain, though some higher offers for ex-Japan HRC have been reported in Spain at €730/mt CFR.