Having no other choice, Emirati re-rollers have been forced to accept higher prices for hot rolled coil (HRC) in their latest bookings. However, overall, the stance of Emirati buyers has remained cautious amid mixed sentiment with regard to the future price trends.
Accordingly, in recent days Emirati buyers have booked at least 25,000 mt of ex-India HRC at $910/mt CFR. The price level corresponds to the price initially targeted by suppliers, though cautiously voiced at the beginning of negotiations. “Actually, there are not so many inquiries in the market. For most players, it is a wait-and-watch game,” a representative of an Indian mill stated. In particular, despite the current bullish stance of Indian HRC suppliers amid low availability of export volumes, market participants are quite skeptical that prices will move up further. “A certain tightness will remain until May production at least, though I should say that as of now Indian mills are very unsure. My best guess is prices will be around $880-910/mt CFR levels,” an official at another India-based mill stated.
Despite the appearance of aggressive offers from Chinese traders in other destinations, ex-China HRC prices have remained unworkable for the Emirati market. “China is offering much more expensive material compared to the Indian mills, attracting no interest,” a major flats distributor in the UAE said. Meanwhile, a major South Korean HRC supplier is said to have no allocation for the GCC region at present.
On balance, being caught in the crossfire between tight supply and high prices, Emirati HRC customers have no other choice but to accept the current prices to meet their urgent needs.