This week, the global hot rolled coil (HRC) market has continued to see different developments and price trends, depending on the region. In the EU, most mills have kept reducing their HRC prices given muted trading activity amid slow end-user demand coupled with high stock levels of buyers, while in Asia, the market has seen another expected weakening of offers, resulting in another drop in China after the holidays. At the same time, suppliers from Turkey and India have been trying to maintain high domestic prices. However, while in India the current trend has been reasonable amid steady restocking by trade channels, in Turkey, on the contrary, most buyers do not consider domestic prices workable, while import offers remain plentiful and fairly competitive.
In Turkey, the domestic HRC prices officially are still at $700-710/mt ex-works, although $680-685/mt ex-works levels are also considered possible. However, the large buyers are mainly not eager to book anything above $660-670/mt ex-works. The mills, however, are limited by the rising production costs and are trying to avoid discounts. Same reason has pushed up the coated and cold rolled prices in Turkey – HDG is now at $880-915/mt ex-works base and CRC is on offer at $840-860/mt ex-works. In the import segment, most of the HRC offers are coming from Asia – at $630-640/mt CFR from Korea and $660/mt CFR from Indonesia. Offers from a large Indian mill and a non-sanctioned Russian producer are at $650/mt CFR. Another Russian supplier has recently traded medium volume at $600/mt CFR. On exports, the indicative HRC offer from Turkey is still at $680-700/mt FOB, which is not workable due to the fierce competition with Asian suppliers in the European market.
In Europe, most mills have kept reducing their HRC prices, though most of them have been failing to attract buyers given low demand and more attractive import offers. In particular, the general range in the EU HRC market is currently at €710-740/mt ex-works, compared to €720-750/mt reported on Monday, October 10. More specifically, achievable prices are currently in the €710-740/mt range in the Italian market, compared to €730-750/mt at the beginning to this week and down by €20-30/mt week on week. In northern Europe most customers estimate the tradable level at €700-720/mt, down by €20/mt from the higher end of range since the beginning of this week. Meanwhile import HRC offers to southern Europe have dropped to around €650-700/mt CFR, depending on the origin, compared to €670-700/mt CFR at the beginning of this week, and down by €20-30/mt over the past week. The lower end of range corresponds to import offers coming mainly to Italy at €650-670/mt CFR, while import offers to Spain have settled at €680-700/mt CFR, depending on the origin. According to market insiders, the price downtrend in the EU HRC market is unlikely to come to a halt in the short-run, given muted trading activity amid slow end-user demand coupled with high stock levels at buyers.
In China, HRC exporters have returned to the market after the long National Day holiday (October 1-7) mainly with the same prices, though some mills have even dropped their offers given the customers’ resistance to any price increases amid still slow demand in most main destinations. In particular, export offers for boron-added SS400 HRC given by major mills are at $560-585/mt FOB for mainly December shipment, with a midpoint at $572.5/mt FOB, down by $7.5/mt over the past two weeks. At the same time, the tradable level for ex-China SS400 HRC has settled at $530-550/mt FOB, compared to $550-560/mt FOB at the beginning of the week, down by $20-25/mt over the past two weeks. According to market insiders, most ex-China SS400 HRC offers have been heard in Vietnam at $550-560/mt CFR, compared to $570-575/mt CFR two weeks ago, while ex-China SAE1006 HRC has been offered at $570-585/mt CFR Vietnam, down by $5-10/mt week on week. Domestic HRC prices in China are at RMB 3,880-3,910/mt ($539-544/mt) ex-warehouse on October 14, with the average price level RMB 65/mt ($9/mt) lower as compared to October 7, according to SteelOrbis’ data.
In Vietnam, prices of imported HRC have shown a new fall this week following the Chinese suppliers’ return from long holiday. In particular, several deals for ex-China SS400 HRC have been reportedly done this week at $550-560/mt CFR, following numerous deals signed at $565-570/mt CFR two weeks ago. Meanwhile, the prices available for ex-China position SAE1006 HRC are as low as $575-585/mt CFR Vietnam, down by $5/mt week on week. In the meantime, considering falling import prices coupled with still poor local demand, Vietnamese steel producer Formosa Ha Tinh Steel has announced new prices for re-rolling grade SAE1006 HRC (non skin-passed) to local customers at $593/mt CFR, down by $17/mt from the previous month, while for skin-passed SAE1006 coils the price level has dropped to around $600-605/mt CFR. The SteelOrbis’ reference price for import SAE1006 HRC has moved to $575-590/mt CFR, down by $5/mt from the lower end of range week on week.
Indian HRC exporters have largely rolled over their prices. Meanwhile no deals have been confirmed amid rising bearish sentiments in most destinations, even though a number of offers were submitted in markets like Asia and the Middle East. The tradable price level for ex-India HRC has been reported in the range of $560-580/mt FOB, the same as last week. The lowest offer from one Indian mill in Vietnam was at $590/mt CFR, which translates to $560-565/mt FOB depending on the cargo size, but no deals were heard in the market pointing out that bids received from Vietnam were at levels of $580/mt CFR and below, making deals unworkable. One mill from India was offering at $610/mt CFR to Turkey which is equivalent to $570/mt FOB with also no deals done. In Europe, the most competitive offers from India were at €670-680/mt CFR, down by €10-20/mt over the past week.