The general market sentiment in the hot rolled coil (HRC) market globally has been mainly positive, though the future market trend has remained unclear, given the slight softening of HRC prices in some countries. In particular, while more hikes in domestic HRC prices have been seen in Turkey and Europe, suppliers from Asia, including those from India, Japan, Taiwan and others, have been more restrained in terms of further increases in higher-priced destinations, offering small discounts in Europe and the Gulf region. However, in Asia itself the uptrend has continued to gain momentum, with higher domestic HRC prices reported in Vietnam and China, in particular.
The Turkish flats market has seen a significant price upturn this week, spurred by rather active restocking. The earthquakes have obviously caused steel production disruptions in the Iskenderun region, as well as resulting in expectations that demand will increase in the short and medium terms. As a result, flat steel buyers, who were generally low on stocks lately, have been restocking actively. Starting from the end of last week, Turkish HRC producers have traded at least 250,000 mt locally at $770-790/mt ex-works and increased prices to $800-820/mt ex-works minimum. Some report levels even $10-15/mt higher. As regards exports, some producers decided not to offer, while some have been voicing $800-805/mt FOB minimum. In the import segment, Russian material has been traded at $700/mt CFR and $730/mt CFR depending on the mill. Overall, at least 60,000 mt have been sold. China closed deals for 25,000-30,000 mt at $665-670/mt CFR earlier and is now offering at $700-710/mt CFR. Aside from HRC, prices for other flat products have also risen significantly. The latest offers for HDG are at $1,080-1,120/mt ex-works base, while the indications for CRC are at $920-940/mt ex-works minimum and are even hitting $950/mt ex-works in some cases.
In Europe this week, the leading regional producer ArcelorMittal has decided to push its domestic prices for May deliveries across the EU up by €20/mt. As a result, official HRC offers from European steel mills, both in northern and southern Europe, have increased to €770-780/mt ex-works, and some to €800/mt ex-works, up by €10-20/mt week on week. The tradable values have also moved up, to €760-770/mt ex-works in Italy, versus €740-750/mt ex-works last week, though, according to some sources, €750/mt ex-works may still be workable in Italy. In northern Europe, most mills have reported full HRC order books for April deliveries, and, according to sources, the tradable HRC prices have been estimated at €765/mt ex-works, compared to €750-760/mt ex-works last week. In the meantime, in the import segment, the most active in offering have still been the suppliers from Asia, who decreased their offers for Europe on dollar basis by around $20/mt, aiming to offset currency fluctuations, and have maintained their offers on euro basis at €735-760/mt CFR, depending on the supplier. Offers from India have been heard at €735-745/mt CFR Spain, with a few deals reported at these levels, though, according to some sources, lower offers for ex-India HRC have been reported in Italy at €725/mt CFR, but “for only limited tonnages.”
Ex-India HRC prices have softened slightly this week and, though trade activity has remained healthy, there has been increasing pessimism over the possibility of further upside gains from the current levels, at least for now. Moreover, though sales prices to Europe have remained mostly stable, a lower level has been fixed in trades to the Gulf region. Average ex-India prices have ranged at $680-730/mt FOB, with the midpoint at $705/mt FOB, lower than $700-740/mt FOB a week ago. The higher end of the range still corresponds to sales to Europe. Another supply contract has been reported for ex-India coils with a UAE-based buyer at $685/mt FOB for a tonnage of over 10,000 mt. The CFR price in the deal has been assessed at $715-720/mt CFR. This is down from the higher price in a deal signed by another Indian producer to the same destination at up to $720/mt FOB a week ago.
In the UAE, there has been little interest in importing HRC because China's weaker offers are still available and most buyers have begun to predict a further softening of offers while there is still a need to replenish. As a consequence, over 10,000 mt of HRC from India has been booked at roughly $715-720/mt CFR to the UAE, whereas another Indian supplier recently sold 5,000 mt HRC to the GCC region at $688/mt FOB. New ex-India offers have dropped by $25-30/mt, though some suppliers have continued to pursue unworkable levels of $730-740/mt CFR. In the meanwhile, ex-China offers are still unclear. For the time being, some mills are offering lower levels of $670-680/mt CFR, and others’ offers are unchanged at $690-700/mt CFR for shipment in April. According to sources, a 20,000 mt lot of ex-China SS400 has been booked to the UAE at $655/mt CFR. Otherwise, ex-South Korea and ex-Japan prices have remained steady at $745/mt CFR and $740/mt CFR, respectively. Apart from the GCC, there has been a booking to a Gulf region-based buyer from Russia for 30,000 mt of HRC for April shipment at $700/mt CFR.
In China, most big mills have rolled over their export prices, with only some small corrections reported. In particular, export offers for boron-added SS400 HRC given by major Chinese mills are at $650-670/mt FOB, the same as last week, though several producers have reported their offers at $640/mt CFR, down by $10/mt, while some have maintained offers at $680/mt FOB. Meanwhile, the tradable prices for ex-China SS400 HRC have settled at $615-645/mt FOB, compared to $600-640/mt FOB at the beginning of this week, and up by $5-15/mt week on week. According to sources, after several deals for ex-China SS400 coils were reported at $610/mt CFR Vietnam, most offers have increased to $625/mt CFR Vietnam by the end of the week. In the SAE1006 HRC segment, Chinese suppliers sold around 90,000/mt of materials to Vietnam at $660-665/mt CFR, with new offers mainly coming at $670-680/mt CFR by the end of the week. In the meantime, domestic HRC prices have been indicating ups and downs amid fluctuations of futures prices. Domestic HRC prices in China are at RMB 4,130-4,270/mt ($600-620/mt) ex-warehouse on February 16, with the average price level RMB 35/mt ($5/mt) higher than that recorded on February 9, according to SteelOrbis’ data.
More clarity has emerged in Vietnam’s HRC market with new deals reported for ex-China materials at higher levels coupled with local producer Formosa’s Ha Tinh announcement of new HRC prices for domestic customers. In particular, Formosa Ha Tinh Steel has increased its offers for non-skin passed SAE1006 HRC and SS400 HRC to local customers to $695/mt CFR, up by $60/mt month on month. Skin-passed SAE1006 HRC coils have been priced for April at $700/mt CFR, versus $640/mt CFR last month. Meanwhile, the latest offers for SAE1006 HRC from China have been heard at $670-680/mt CFR, up by $10/mt from the latest deal prices. Besides, some ex-China offers have already been heard at $690/mt CFR and above. Offers for ex-China SS400 HRC have settled at around $625/mt CFR, versus deal prices at $610-615/mt CFR reported at the end of last week and beginning of this week. Meanwhile, Indian suppliers have been mainly staying out of the Vietnamese market, focusing on higher-priced destinations, with the indicative offers for SAE1006 HRC estimated at above $700/mt CFR Vietnam. Furthermore, indicative offers for ex-Japan materials have been heard at $690-700/mt CFR. The SteelOrbis reference price for import SAE1006 HRC in Vietnam is at $670/mt CFR, versus $660-670/mt CFR at the start of this week.
