The general market sentiment in the global hot rolled coil (HRC) market has remained mainly negative this week. While in the Mediterranean region prices are still under pressure from low demand, with lower domestic offers reported by Turkish and European suppliers, in Asia the situation has been very quiet, given the long holiday in China. At the same time, no fresh deals have been reported from Indian sellers, who are still focused on domestic sales.
While Chinese suppliers have been out of the market this week due to their long holiday, no business activity has been heard in Vietnam, with reference prices for imported SAE1006 HRC standing at €570-575/mt CFR, versus $568-570/mt CFR last week, since most market insiders believe Chinese suppliers will return with slightly higher offers next week.
In Europe, demand for HRC has remained weak given sufficient stocks, while the significant influx of imported HRC from the first days of October has been providing support for the negative mood in the market. Tradable HRC offers have been estimated at €610-630/mt ex-works, down by €5-10/mt week on week. In particular, offers from Italian mills have been reported at €615-625/mt ex-works, mainly the same as last week, but, according to sources, prices below €600/mt have been targeted by buyers. In northern Europe, most mills have been refraining from giving any firm offers, with the estimated tradable levels at €620-630/mt ex-works, down by €10/mt on the higher end of the range over the past week, though several bids have been voiced at €600/mt ex-works. At the same time, the lull in business activity in the import segment has continued this week, with reference prices reaching €585-635/mt CFR, versus €585-610/mt CFR last week. The lower end of the range corresponds to ex-Vietnam offers in Italy, while the higher end corresponds to ex-Turkey offers, including duty.
Turkish domestic HRC prices have softened this week due to pressure from buyers and weak exports. Offers are now at $640-660/mt ex-works depending on the mill. Higher indications are also present in the market, but generally are not considered workable for medium and large volumes. In fact, one mill is reported to be in talks with a large pipe producer to sell HRC at around $625/mt ex-works. Export offers have been mainly reported at $600-640/mt FOB, depending on the supplier and the sales destination. Lower levels are traditionally offered to non-EU markets, but buyers’ bids are currently $20-30/mt below $600/mt FOB. In the import segment, China is out of the market due to its long holiday, while Russia is absent due to the export duty issue. However, according to sources, Ukraine has traded a 10,000 mt HRC lot at $580-585/mt CFR Turkey, while Egypt has sold at least 20,000 mt at $640/mt CFR Turkey, but for high grade material. Offers for HRC from the EU have been at $600/mt CFR, but, according to sources, the supplier chose to sell to an alternative destination at a higher price.
In the UAE, trading activities have been quiet this week since Chinese hot rolled coil (HRC) suppliers are on holiday for a week, while other suppliers have chosen to maintain unchanged levels for offers of HRC to the UAE. As a result, Chinese offers for SS400 this week have remained identical at $570-580/mt CFR to the UAE. Similarly, offers from Japan and South Korea have maintained their previous week's positions at $600/mt CFR to the GCC and $590/mt CFR to the UAE, respectively. In the meantime, Indian suppliers have continued to do business in their own markets where they have continued to be more successful, and so they further delayed their offers to the GCC.
Indian HRC exporters have kept refraining from sales, with ex-India HRC prices remaining at $590-620/mt FOB, the same as last week. Sentiment has remained positive in the local market, with Indian mills continuing to increase their offers for domestic customers. Besides, the demand recession is so deep across Asia that, even with ex-China offers falling silent owing to the long holiday, lower supplies have failed to have any impact on prices, while Indian sellers are notionally maintaining stable export prices amid negligible export allocations and robust domestic sales.
