The fallout caused by the spread of the Covid-19 virus has kept spot demand for hot rolled coils (HRC) in the UAE sluggish. According to sources, local buyers have sufficient stocks for now.
In such market circumstances, Indian hot rolled coil suppliers prefer negotiating with each customer individually rather than giving official firm offers. “In the case of 15,000-20,000 mt orders, we are ready to consider $475-480/mt CFR,” an Indian mill said earlier this week. “However, activity is slowing down”, he added. By the end of the week, the level of $465-470/mt CFR has been already reported as achievable.
“Besides the lack of activity, the problems with logistics appear every week”, a representative of an Indian mill said. Since last week, the Indian government has announced compulsory 14-day quarantine for all shipping crews who have travelled specific routes (via the GCC, Japan and South Korea), with the need to disembark at Indian ports. This will lead to congestion at ports and some delays in ships’ turnaround times, some sources believe. As for the current situation, one UAE-based customer reported, “Everything seems to be on track. Our two cargoes are under loading.”
Japanese suppliers, having recently sold hot rolled coils to the UAE at $480-485/mt CFR, have decided to take a pause in order to evaluate the market.
Along with the maritime issues and overall worries regarding the spread of the virus, there are additional concerns raised by China having announced it will increase the export tax rebate from 10 to 13 percent effective from March 20. “It is a time when everybody is literally trying to survive. We need to be ready for the price war,” a representative of an Indian mill said.