Indian HDG export offers emerge from downtrend amid rebound in ex-China offers, limited Gulf buying interest

Thursday, 04 July 2019 14:12:51 (GMT+3)   |   Kolkata

The long-standing downward trend of Indian HDG export prices has been reversed during the past week, with Indian exporters hiking offers by around $15/mt week on week to $610/mt FOB on the back of the rebound in ex-China offers and the slight improvement in buying interest in key markets like the Gulf Co-operation Council (GCC) region, traders said on Thursday, June 4.

“Indian traders are quick to take their cue from the rise in ex-China offers to revise their own offers amid the improvement in buying interest, even though buyers’ volumes have remained modest,” a Mumbai-based trader said.

“Indian exporters reckon that, even though demand in key markets like the GCC and Southeast Asian will remain at low levels, reports of production cuts by Chinese steel mills will ensure supply-side support for export offers,” the trader added.

However, two other traders taking a contrarian view said that Indian traders’ ability to improve volumes shipped overseas will remain limited as they will not be able to compete with ex-China offers which are still more competitive compared to ex-India HDG.

The traders also said that, unless the Indian currency which is showing stability against the US dollar depreciates much beyond INR 70 to the dollar and ensures higher export margins, Indian HDG offers will continue to move within a narrow range and overseas shipments will remain at lower levels.

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