This week, buying activity in the hot rolled coil (HRC) segment in the GCC region has remained muted, with most buyers having continued to stay on the sidelines. The imposition of a 15 percent export duty on HRC, as well as on all other flat steel products, by the Indian government has added uncertainty regarding future developments in the sector regionally. “Indian mills are still contemplating the situation and should be ready with a decision shortly,” an official at a major Indian steel mill commented. “I was speaking to some major exporters in India. They would probably absorb this additional amount just this once and not let the customers pay. However, afterwards India would hardly export as long as the 15 percent export duty remains,” a UAE-based flats distributor stated. Notwithstanding a potential decline in shipments because of the developments in India, import HRC offers to the GCC region have decreased, in particular, those voiced by Indian exporters.
Specifically, ex-India SAE1006 2 mm HRC is said to be available at $840/mt CFR, down $70-80/mt within the past two weeks and down around $40/mt compared to the levels voiced last week. “The main export markets for Indian exporters have always been the US and the European Union. In terms of volumes, they might just export two percent of their volumes to the Gulf region,” a regional HRC importer said regarding the consequences on trade to the GCC region following India’s decisions.
Although Chinese HRC exporters have been expected to take advantage of the situation, the Chinese sellers have continued to decrease their prices aggressively. Specifically, while at the beginning of the current week, ex-China SA1006 HRC was voiced at $820/mt CFR, by the end of the given period, their offers have been heard at about $795/mt CFR levels. Meanwhile, ex-China cold rolled full-hard (CRFH) coils are said to be available at $835/mt CFR.
Ex-Japan HRC are offered at $880/mt CFR, without no buying interest due to the availability of lower-priced offers. Saudi flats supplier, Hadeed, is said to be in the market with offers below $880/mt CPT, around $140/mt lower offers initially targeted.