Most major global importing hot rolled coil (HRC) destinations have continued to see falling workable price levels. The main reason is the overall subdued demand in domestic markets globally along with the aggressive offers from China which have been generating negative expectations among other suppliers, especially those from Asia. Europe remains the only exception for now since domestic prices there have not dropped and some sources are optimistic on the prospects for rises in local HRC prices after the summer holidays. Still, HRC imports in Europe have been challenging, especially for sellers in the “other countries” category.
HRC export offers both from Chinese mills and traders have decreased sharply this week as HRC prices in the Chinese domestic market have indicated big declines following the slump in HRC futures prices. Export offers for boron-added SS400 HRC given by major Chinese mills have come to $500-505/mt FOB, with a midpoint at $502.5/mt FOB, down by $15/mt over the past week, though some offers from a several big mills like Benxi Steel are still officially reported at $520/mt FOB. At the same time, the tradable prices for SS400 HRC have been estimated at $487-500/mt FOB, down by $15-20/mt since the beginning of last week. Ex-China SS400/Q235 HRC offers in Vietnam are heard at $500-505/mt CFR, versus $520/mt CFR last week. Besides, offers for Chinese SS400 HRC in Pakistan have been estimated at around $515-525/mt CFR, depending on the supplier. In the meantime, offers for ex-China SS400 HRC in the Middle East have been reported at $535-540/mt CFR for September shipment, against $560/mt CFR at the beginning of last week and versus $540-545/mt CFR at the end of last week. According to sources, several deals have already been signed at $535-540/mt CFR UAE this week, while bids have been voiced at as low as $530/mt CFR.
This week has brought a significant decrease in HRC prices from Chinese suppliers to Vietnam, with offers for ex-China SS400/Q235 HRC falling by at least $15/mt since the beginning of last week. Specifically, offers for ex-China SS400/Q235 have been voiced at $503-505/mt CFR mainly for September shipment, against $520-mt CFR at the beginning of last week and deal prices at $513-515/mt CFR at the end of last week. According to sources, at the end of last week several deals for around 10,000 mt in total of ex-China Q235 HRC were signed at $515-515/mt CFR. Besides, offers for ex-China Q195 HRC have been heard at $500/mt CFR for September shipment, down by $15/mt week on week. As for the SAE1006 HRC segment, most offers have been voiced at $520-530/mt CFR for September shipment, down by $10/mt week on week, while most market insiders estimate workable prices at not higher than $520/mt CFR. Thus, the SteelOrbis reference price for imported SAE1006 HRC has fallen to $520/mt CFR, versus $530-540/mt CFR at the beginning of last week.
Most large Indian mills have completely stopped submitting hot rolled coil (HRC) offers across export markets to avoid mounting negative uncertainties and declining prices, with buyers in the Middle East heard to be seeking “unviable discounts”, while there has been little interest in imports in Europe. As a result, indicative ex-India HRC prices have remained at $560-600/mt FOB. According to market insiders, buyers in the Middle East have been seeking deep discounts at as low as $520/mt FOB, or around $550/mt CFR, while ex-China SS400 HRC prices have been reported at $535-540/mt CFR UAE this week. In the meantime, at the beginning of the week offers for ex-India HRC in Europe have been estimated at $650/mt CFR, though, by the end of the week European customers have reported ex-India HRC prices at $630-640/mt CFR levels, which translate to around $575-580/mt FOB.
HRC offers from mills in Europe have remained at €630-650/mt ex-works in northern Europe and at €630-640/mt ex-works in Italy, both mainly for September delivery, the same as last week. Meanwhile, the tradable price level is still estimated by most distributors at around €620-630/mt ex-works in both regions, with sources expecting the market to weaken further in August, especially in southern Europe due to the summer breaks. At the same time, talk about €20-30/mt price increases from EU mills for HRC for October delivery has been circulating in the market as demand may pick up after the summer season against the backdrop of low stocks and better demand. However, most EU buyers doubt the sustainability of any anticipated upward price movement. In the meantime, business activity in the import segment has remained slow this week, with most offers for ex-Asia HRC heard at €570-610/mt CFR levels for September-October shipments, down by €5/mt on average week on week. Specifically, offers for ex-Vietnam HRC have been voiced at €570/mt CFR. Suppliers from Turkey have been offering their materials at around €600/mt CFR, including duty, while, according to sources, talk about a deal signed at €590/mt CFR at the end of last week has been circulating in the market.
In Turkey, hot rolled coil (HRC) prices have softened once again this week, mainly driven by more aggressive prices from China. Over the past week, import HRC offers from China have declined from $542-550/mt to $535-540/mt CFR and, according to sources, some sellers have even been ready to agree to $530/mt CFR. Although the price levels are attractive and are the lowest ex-China HRC prices to Turkey seen in the past year, no fresh deals have been confirmed. Rumors indicate that one of the largest traders has sold a decent volume, but most of possible buyers, i.e., re-rollers and pipe-makers, have denied that they booked material. In the domestic market, the realistic HRC price level has slid by $5-10/mt over the past week to $570-585/mt ex-works base, but demand has still remained on the low side. Smaller buyers, however, stated they have received up to $600/mt ex-works this week. As regards exports, though the official offers are at $580-585/mt FOB, large buyers consider $560-570/mt ex-works quite reachable for September deliveries.
In the UAE, interest in importing HRC has been increasing, in particular for Chinese material, as ex-China prices have continued to fall. Although domestic demand in the UAE remains poor, Emirati buyers bought 3,000 mt of HRC last week at $540/mt CFR. Furthermore, as offers from China to the UAE for SS400 grade HRC have this week dropped by $15-20/mt to $535-540/mt CFR for September shipment, some deals have already been done at $535-540/mt CFR. Similarly, small declines in prices have been noted from Japanese suppliers who sold to the GCC last week at $555/mt CFR and are now offering at $550/mt CFR for September shipment. Market participants also claim that, if additional declines are seen in the coming weeks, trade may start to pick up in the GCC. Indian suppliers, however, have remained silent and are still not giving offers.
