The general market sentiment in the hot rolled coil (HRC) market globally has been mainly positive this week. While in the Mediterranean region the price uptrend has been rather lively, with numerous deals reported by Turkish suppliers and European buyers, in Asia the situation has been calmer, given the holidays in China and Vietnam. At the same time, exporters from India have continued to achieve higher levels in new deals to different destinations, and are expecting more hikes in the next round of bookings.
In Turkey, domestic and import flat steel business activity has been rather silent this week, but the mood has been mainly optimistic. The key reason is the expectation regarding a positive return by China to the market, which would also mean there will hardly be aggressive offers from other Asian suppliers to Turkey. Another factor in favour of this expectation is the HRC price uptrend in the EU, which is not only helping Turkey to export HRC to the region, but also attracts the attention of the sellers from Asia due to the higher workable prices. In the domestic market, offers have remained at $740-760/mt ex-works and above, but buyers expect levels of $730/mt ex-works and slightly below to be workable also. Mills report that they are mainly offering for April deliveries nowadays to the domestic market, although it seems that for HRC exports shorter lead times are available. In the import segment, Asia is expected to return with higher offers next week, and so most suppliers, including the Russians, are not in a rush to give firm offers now. The latest import deal was closed from Egypt for around 25,000 mt at around $675/mt CFR base, SteelOrbis has learned.
In Europe, the uptrend of HRC prices have as expected continued to rise this week amid the improved end-user demand and the almost fully closed orders for March deliveries of domestic mills. In particular, compared to last week, HRC offer prices in the EU have increased by around €10-30/mt to €740-780/mt ex-works, with the lower end of the range corresponding to offers in the south and the higher end to offers in the north of Europe. More specifically, tradable prices are currently at €740/mt ex-works in the Italian market, compared to €730/mt ex-works at the beginning of last week. At the same time, according to sources, mills in southern Europe are targeting €760-780/mt ex-works for April deliveries, though nobody has officially declared their April allocations so far. Meanwhile, steel mills in northern Europe have largely been out of the market this week, though, according to market insiders, the indicative offer prices are estimated at around €760-780/mt ex-works, with a targeted increase to €800/mt ex-works for April delivery materials. Meanwhile, the mood in the import HRC segment in southern Europe has continued to improve over the past week, with several deals reported at higher levels. In particular, import HRC prices in southern Europe have increased in new deals by around €20/mt over the past week to €710-735/mt CFR, with the lower end of the range corresponding to deal prices for ex-Japan HRC and the higher end to deal prices for ex-Turkey and ex-Egypt materials. In fact, since last week, Turkey has traded at least 30,000 mt of HRC to the south of the EU at $720-730/mt FOB and medium-sized lots to Macedonia, Albania and Kosovo at, according to some sources, $710/mt FOB, while others report that the deal price was at around $730/mt FOB for a total of 15-20,000 mt.
Ex-India HRC prices have continued to reach higher levels, but gains are uneven with realizations improved mostly from sales to the EU region. The reference price for ex-India SAE1006 2 mm HRC reached $650-680/mt FOB early this week, up $15/mt from the previous week, but it ended the week at $670-720/mt FOB, with the midpoint at $695/mt FOB. As a result, the week-on-week surge of ex-India prices hit $45/mt. The most significant of buoyant export trades were at as high as $720/mt FOB or $770-780/mt CFR to Europe. The lower end of the range was mainly indicative as the Asian market has been closed for the long holiday, but even here, where CFR prices last week were lower than the current FOB prices from India, suppliers are unlikely to offer at lower than $670/mt FOB next week. New offers for April shipment at the $700/mt FOB mark or above were reported from a number of mills.
In the GCC market, some restocking has been seen for HRC since buyers have feared further price increases due to the expectations of a positive return by China from its holiday. As a result, a total of 50,000 mt of HRC has been booked from Japan at $690/mt CFR and the offers have increased further by $20/mt. Some Indian mills have been trying to push offers up to $720-730/mt CFR UAE, while South Korea is offering at $745/mt CFR in the most recent offers, up $35/mt over the past week.