Ex-India hot rolled coil (HRC) prices have shown a slight upward bias over the past week, but most large mills have continued to refrain from submitting offers or pursuing bids against the backdrop of the local market showing signs of tightening supplies across the distribution chain and improving sales realizations.
More specifically, ex-India offers in the Middle East have been reported in the range of $485-500/mt FOB, up by $10-20/mt week on week, but the sellers have not been responding to lower bids from customers as most mills are focused on robust domestic sales volumes and better margins. According to sources, offers for ex-India HRC in the UAE have been voiced at $510-525/mt CFR, up by $10-20/mt week on week.
According to the sources, while demand in key regions like the UAE has remained moderate, buyers are not willing to accept higher offers, while sellers supported by local market conditions are not responding amid tight local supplies, low export allocations during the last quarter of the fiscal year, and rising local prices.
Furthermore, this week offers for ex-India HRC in Vietnam have been voiced at $500/mt CFR, compared to $493-500/mt CFR last week, which translates to around $480/mt FOB.
At the same time, ex-India HRC offers in Europe have remained rare. Indicative offers for ex-India HRC in Europe have been voiced at $600/mt CFR and above, the same as at the end of last week, which translates to around $550/mt FOB.
As a result, the SteelOrbis reference price for ex-India SAE1006 HRC has settled at $480-550/mt FOB, up by $5/mt on the lower end of the range since the end of last week.
“Current acceptable prices in key markets offer nothing in terms of profitability for any exporter. Even mills’ official listed prices for HRC at levels of INR 54,000/mt ($595/mt) are more competitive than export offers. This is not factoring in that trade prices are currently at a premium to the list prices of producers,” an affiliate of Tata Steel Limited told SteelOrbis
“There are some unconfirmed reports of stray deals for very small volumes by medium-sized mills or distributors. But these are sales only to maintain market presence as a strategy. In our assessment, exports will remain a peripheral activity for producers for the rest of the fiscal year,” he added.
