The global hot rolled coil (HRC) market has continued to show mixed trends as Chinese suppliers have closed deals at higher prices internationally ahead of their long holiday. In contrast, Indian mills face challenges in securing deals due to the competitive Chinese pricing, despite slight reductions in ex-India HRC prices. Attempts by Chinese suppliers to increase prices have struggled to gain traction in Vietnam, while GCC countries remain active in restocking, with ex-China offer prices on the rise. In Turkey, HRC prices have seen a slight uptick, though the sustainability of demand remains uncertain. Meanwhile, EU producers have maintained stable but high prices even amid sluggish demand.
Chinese HRC mills, who had mostly maintained their offers at unchanged levels last week, have this week decided to go higher amid improved sentiments in the futures and local HRC markets in China. In particular, export offers for boron-added SS400 HRC from large Chinese mills have settled at $470-480/mt FOB, with a midpoint at $475/mt FOB, up by $7.5/mt week on week for February and March shipments. Meanwhile, the tradable level has been corrected up in numerous deals since the end of last week as most sellers have decided to secure more bookings at higher price levels before leaving the market for the holiday. Specifically, Chinese HRC suppliers have managed to sell sizable volumes globally, while the tradable prices have increased to $468-475/mt FOB, depending on the destination, up by $8-10/mt week on week. According to sources, at least 15,000 mt of ex-China coils have been sold in the UAE at $510/mt CFR. Besides, more deals for around 10,000 mt and 30,000 mt, respectively, have been reported in Oman and Saudi Arabia at $490/mt CFR and $515/mt CFR, according to sources. Furthermore, ex-China Q195 HRC cargoes of around 45,000-50,000 mt are reported to have been sold in Turkey at $502/mt CFR, versus deal prices at $484/mt CFR at the end of last week. In addition, offers from Chinese second-tier mills have settled at $495/mt CFR.
Trade activity in the Vietnam’s HRC import market has remained sluggish as Vietnam like China is about to begin the Lunar New Year holiday and most market insiders have already left the market. At the same time, following the recovery of HRC import prices last week, most offers have continued to increase this week as Chinese traders have decided to go higher once again before leaving the market for the holiday. However, despite the higher offers, especially for ex-China Q235 HRC, tradable prices for SAE1006 HRC have mainly moved sideways, while a number of customers have even been pushing for discounts. The SteelOrbis reference price for imported SAE1006 HRC has moved to $490-495/mt CFR, against $495-500/mt CFR last week, with the lower end of the range corresponding to ex-China SAE1006 HRC offers at $490/mt CFR, while offers from Indonesia have been reported at $495/mt CFR. Furthermore, offers for ex-China Q235/SS400 HRC to Vietnam have been voiced at $479-482/mt CFR, versus $470-475/mt CFR at the end of last week. At the same time, according to sources, local HRC prices from Vietnamese producers Hoa Phat Group and Formosa Ha Tinh Steel have declined to $495-510/mt CIF and $500-510/mt CIF, respectively, down by around $10-20/mt since the beginning of the month. According to sources, although the Chinese HRC futures market has been boosting sentiments among Chinese HRC exporters, import prices are still more competitive as compared to local prices, and so local producers have reduced their offers to attract more buyers. Besides, most doubt more significant import price hikes will be seen after the Chinese New Year holiday in early February.
Ex-India HRC prices have continued to fall below the $500/mt FOB mark as only a few sellers have been heard to be pushing sales overseas, without great success amid tight competition with Chinese suppliers. Specifically, ex-India HRC prices have settled at $485-495/mt FOB compared to $490-500/mt FOB a week ago. According to sources, a deal for around 15,000 mt of ex-India HRC was signed at $520-525/mt CFR UAE at the end of last week, which translates to around $490/mt FOB. In the meantime, market insiders emphasize that, even though ex-China prices have been showing some improvements, buyers still lack confidence as regards doing import trades, expecting some softening in offers, and Indian sellers have still been unable to compete with Chinese suppliers, who have managed to secure numerous deals to the Middle East.
Turkey’s HRC market has been rather quiet this week ahead of the holiday in China, and, while domestic and export prices have remained more or less in line with previous levels with some discounts provided, import offers have inched up. By the end of the week, local HRC offers in Turkey have stabilized at $550-560/mt ex-works despite some efforts by mills to increase them, while $540-545/mt ex-works levels have been reported in small-tonnage sales. HRC export prices in Turkey are at $530-540/mt FOB officially, while with a firm bid it is possible to get $520-525/mt FOB. Import offers from China for large lots of Q195 first rose from $480-484/mt CFR to $495-502/mt CFR, and then increased further to $505-510/mt CFR by the end of the week. There has been talk about a recent sale at around $495/mt CFR, following deals at $485/mt and $490/mt CFR reported earlier. However, most market players believe it is not likely anyone will book at these levels before the holiday, for May delivery, and since domestic HRC prices in Turkey are quite weak. Egypt was also in the market with offers at $550/mt CFR, with no new deals reported.
In Egypt itself, HRC prices locally have been reported at $570/mt ex-works and demand has remained decent. Import offers from China have been at $500-505/mt CFR throughout the week, but some North African buyers, including buyers in Egypt, have chosen to restock with Russian March production HRC at $500-505/mt CFR, up from deals at $490/mt CFR closed earlier.
In the GCC, since buyers have expressed interest in imports, primarily Chinese and Indian materials, trading activities have remained lively in the region. According to reports, Omani, Emirati and Saudi purchasers bought 12,000 mt, 15,000 mt, and 30,000 mt of SS400 grade HRC from China at $490/mt CFR, $510/mt CFR, and $515/mt CFR, respectively. Meanwhile, offers from China to the UAE have increased by $20/mt since last week, reaching $510-520/mt CFR. Another purchase has been concluded by Emirati purchasers for 15,000 mt of SAE1006 grade HRC from India at $520-525/mt CFR, and the majority of offers from Indian suppliers have also remained at these levels this week. On the other hand, Japanese suppliers, who were active in recent weeks and sold some quantities to the UAE at $500-510/mt CFR, have given no fresh offers over the past week.
In Europe, although most producers in northern Europe have been claiming they are largely sold out for the first quarter, offers for March delivery HRC are still voiced in the market at around €590-600/mt ex-works, while offers for April delivery coils have remained at €600-620/mt ex-works, depending on the mill, the same as last week. According to sources, however, tradable prices are still estimated at below €600/mt ex-works, with several transactions reported at around €580-590/mt ex-works. Offers from mills in Italy have been voiced at €600-610/mt ex-works, the same as last week, though buyers estimate workable prices at €570-590/mt ex-works, against €560-580/mt ex-works last week. At the same time, in the import segment, most offers are estimated at €540-590/mt CFR, the same as last week. Ex-Vietnam HRC offers have settled at €540/mt CFR, while offers from Taiwan have been reported at €548-550/mt CFR, against €545/mt CFR last week. Offers for ex-Indonesia HRC have been heard at around €560/mt CFR, up by €10/mt week on week. Furthermore, while most offers for ex-Turkey HRC have been assessed at €585-590/mt CFR, including duty, mainly the same as last week, talk about a deal signed at around €570-575/mt CFR southern Europe, duty included, has been circulating in the market, though without any official confirmation provided by the time of publication.