This week, the situation in the global hot rolled coil (HRC) market has been rather stable in terms of prices, as suppliers in most regions have continued to sustain their offers. At the same time, Asia-based sellers, especially those from China have been the most active in terms sales, as more interest in imported HRC has been seen in many regions, such as Vietnam, India, the Middle East and Turkey. In Europe, no trading has been seen in southern European HRC market amid the continuous summer break period, while business activity in northern Europe has remained slack as well, though market insiders have started to actively discuss local mills’ plans for around €50/mt increase in September.
In China, most export offers for boron added SS400 HRC from large Chinese mills have remained at $560-580/mt FOB, the same as at the beginning of this week. However, according to sources, the offer prices are likely to drop to $555-570/mt FOB next week, if futures keep following the current trend. At the same time, Chinese HRC suppliers have managed to sell sizable volumes globally, not waiting for another “promised rise in prices”. Thus, more than 250,000 mt of mainly SS400 HRC for October shipment have been sold from China to different destinations this week. Besides, apart from traditional sales to Asia ex-China HRC business has picked up in the Middle East, India and Turkey.
In Vietnam, after this week started with another drop in deal prices for ex-China SS400 HRC, by the middle of the week offers have shown some recovery, increasing by around $10/mt to $555/mt CFR. However, by the end of the week, the prices have rolled back again as new deals for ex-China SS400 HRC have been reported at $545-549/mt CFR Vietnam for October shipment. In the meantime, in the SAE1006 HRC segment, offers have remined rare, while Chinese suppliers have been offering their materials at $572-580/mt CFR for October shipment, mainly the same as last week. Thus, the SteelOrbis reference price for import SAE1006 HRC has moved to $575/mt CFR, versus $568-575/mt CFR last week, based mainly on Chinese offers while other suppliers have been staying out of the market with indicative offers at $600-610/mt CFR from Japan, Taiwan and South Korea.
Ex-India HRC prices have remained relatively stable over the past week, at $585-620/mt FOB, despite mounting pessimism across Southeast Asia and the lack of interest from the Gulf, coupled almost zero trade activity in Europe amid traditional summer stoppages. Besides, most Indian mills have continued to hold back from new export offers amid improved sales realizations in the domestic market and low export allocations. Fresh ex-India HRC offers in southern Europe have been reported $675/mt CFR, or €624/mt CFR, up by around $10/mt since late July, but no deals have been heard so far.
Turkish HRC producers have experienced some rebound in the domestic demand this week, mainly due to the necessity of some buyers to restock. At least two mills have reportedly traded decent volumes at $650-660/mt ex-works and the general realistic offer price range is estimated at $660-670/mt ex-works. Previously, the targets have been voiced at $700/mt ex-works and above. In the export segment, the indicative price levels are at $630-640/mt and up to $650/mt FOB with not much activity seen after the earlier reported massive sales. In the import segment, Turkish pipe makers have revealed a certain interest in bookings from China and have closed deals for up to 40,000 mt of HRC for October shipments at around $600-605/mt CFR effective. The cargoes are for a large part of thin gauge and different widths, steel grades. In the meantime, the regular Q195 3mm and up material is still on offer in Turkey at $580-585/mt CFR with around $560/mt CFR considered workable. However, such a level is not acceptable for the Chinese mills at the moment.
In the UAE, although end-user demand has remained at low levels, some restocking has been made from the end of the past week. Particularly, around 20,000 mt were booked in mid-August at $585/mt CFR from China, and this week further volumes have been purchased by other buyers at $580/mt CFR, all for October shipments. In addition, the buyers from Oman booked around 5,000 mt at $580-585/mt CFR, while Saudi Arabia purchased up to 10,000 mt at $575-580/mt CFR, SteelOrbis has learned. As for the other origins, there has been unconfirmed circulations stating that ex-India sold 5,000 mt to the UAE for $610-620/mt CFR. However, according to reports, most of the major Indian suppliers are still not supplying the UAE due to stronger demand in the local market. Furthermore, because none of the Emirati buyers have expressed interest, South Korea has continued to remain quiet about offers.
European HRC producers, despite that the local business activity remains slow due to the ongoing vacation season, are voicing targets to increase their prices by €50/mt in September. However, market players have doubts the future uptrend will receive an immediate support, taking into account the demand after the holidays might not be sufficient. The latest domestic HRC prices have been reported at €630-650/mt ex-works in Italy and at €640-650/mt ex-works in northern Europe, which is stable over fortnight. The new targeted levels are voiced at €700/mt ex-works. In the import segment, the latest offers from Asia in euro equivalent have been reported at €598-608/mt CFR, narrowing down from €590-635/mt CFR in late July. No fresh deals have been reported due to high safeguard-related risks and numerous cargoes expected to be delivered in August-September. In addition, in order to minimize risks European customers had given preference to Turkish material in the first half of August and booked large quantities to Spain, Antwerp, Italy, UK and some Central Europe. The deal prices for the largest lots have been reported at $630/mt CFR excluding AD tax.