Brazilian producers are negotiating HRC exports in a reference price of $550/mt, against $540/mt two weeks ago. Such price refers to FOB conditions for the basic commercial grades.
In September, Brazil exported 23,700 mt of HRC, while importing 7,100 mt of the product, against respectively 41,300 mt and 1,100 mt in August. The reduced volume of exports and increased volume of imports reflect a surge of prices in the domestic market, resulting from increased demand and low availability of the product, as domestic producers are still in the process of restarting blast furnaces closed due to the coronavirus pandemic.
The main destination of the HRC exports in September were South American countries (17,000 mt at $412/mt), Mexico (6,000 mt at $631/mt), and the Dominican Republic (700 mt at $439/mt) all FOB conditions and different quality grades.
The main exporters were ArcelorMittal (17,700 mt) and Usiminas (5,900 mt), while a small volume was shipped by CSN.
The 7,100 mt of HRC imported in September, in average at $375/mt, FOB conditions, were almost entirely shipped from Russia to a trader in the Northeastern state of Piaui, in a move reflecting not only the logistics hurdles to move steel products by road for long distances from the producers in the Southeast, but also the high domestic prices.
In the Brazilian domestic market, HRC of the basic commercial grades is offered at BRL 3,845/mt ($685/mt), against BRL 3,759/mt two weeks ago, CFR conditions, no taxes included. Such price refers to high and medium sized volumes of the product, when sold directly to large consumers or to distributors. Premiums of up to 50 percent in relation to such prices are still reportedly paid by small consumers, which usually buy steel products from the distribution chain.
The last offer of HRC received by Brazilian importers from China was priced at $560/mt, stable from two weeks ago. Such price refers to CFR conditions to ports in the Brazilian south or southeastern coast, having the A36/Q235 grade product as reference.
USD = BRL 5.61 (October 19)