Large Indian integrated steel mills have continued to aggressively push hot rolled coils (HRC) into the export market during the past week, attempting to increase prices amid firm demand from China and Vietnam, SteelOrbis was informed on Monday, May 18.
Market sources said that ex-India HRC prices have been at $385-395/mt FOB mainly in contracts to China and Vietnam, up $10-15/mt from $375-380/mt FOB reported a week ago.
New offers from Indian mills have started to come to China and Vietnam at above $420/mt CFR, which corresponds to $400-405/mt FOB for July shipment. Steel mills have said that they have no bookings at this level yet, but some bids from Vietnam have already started to come above $415/mt CFR ($395/mt FOB) and Chinese importers will resume purchases, seeing an improvement in local prices.
Two bookings for Indian coils were at $400/mt CFR to China early last week and, with the freight assessed by market participants as $13-15/mt. the FOB price in those contracts was at $385-387/mt, SteelOrbis has learned. Moreover, one more contract was signed later at $5/mt higher, at $405/mt CFR China.
In Vietnam, sales at the beginning of last week were at $403-405/mt CFR ($383-385/mt FOB) for 50,000 mt in total. But at the end of the week, at least three deals for ex-Indian HRC were signed at $410-415/mt CFR for July shipment ($390-395/mt FOB) for about 70,000 mt in total.
Neighboring Nepal also emerged as a buyer during the past week, booking an estimated volume of 15,000 mt for June shipment.
Although not confirmed officially by the company, the sources said that Jindal Steel and Power Limited (JSPL)’s aggregate export bookings for shipment up to the end of June have touched 500,000 mt, most of which is for HRC deliveries to China.
“Chinese HRC prices are strong. This is supporting Indian steel mills in a time of deep local recession by focusing on overseas markets to maintain minimum plant operations,” a manager at JSPL said.
“However, a close watch needs to be kept on the EU region. We estimate that around 19 million mt of steelmaking capacity had been idled by the pandemic. This volume will start to get back to production over the next weeks. It is still not clear if this production will be supported by demand in the region. Production in absence of demand will give rise to risks to global markets again,” he added.