Indian hot dip galvanized (HDG) coil exporters have nudged up prices for the second consecutive week, by $5/mt week on week to $530-535/mt FOB in view of tight supplies of thinner gauge hot rolled coil (HRC) and the increases margins for overseas shipments of HRC, but buyers have limited their volumes of fresh HRC bookings, expecting the higher price levels not to be sustained, SteelOrbis learned on Thursday, June 4.
Integrated steel mills receiving strong demand for HRC have had a limited captive surplus of thinner gauge HRC for value addition, and hence have been seeking to push up HDG export prices to ensure higher margins.
Though volume bookings in traditional markets like the Gulf Co-operation Council (GCC) region have been cautious, a positive trend has also been sustained owing to increased volume buying interest from EU-based traders, market sources said.
A western India-based steel mill has concluded a contract for 25,000 mt for August shipment with an EU-based trader at a price estimated by the market at $535/mt FOB. The same steel mills had concluded a smaller-tonnage booking in the previous week at $530/mt FOB, the sources added.
A second Maharashtra-based steel mill has reported an export trade of 18,000 mt with a Dubai-based trader at the slightly lower price of $532/mt FOB, the sources said.
“The price increase was prompted by the higher number of inquiries received from the EU, a market which had remained quiet over the past several months, and, with automobile manufacturers resuming operations there, EU traders have become more active,” a marketing official at an Indian integrated steel mill told SteelOrbis.
“Ex-India HDG is very competitive since offers for ex-China have increased significantly over the past week. However, for Indian exporting steel mills, the Gulf region remains a challenge since buyers are seen to be resisting the price rise and lowering volume bookings, anticipating that the price increase will be rolled back,” he added.
