Indian hot dip galvanized (HDG) coil export trade activity has revived slightly with sellers successful in concluding low-volume deals to Africa, SteelOrbis learned from trade and industry circles on Thursday, November 24.
Ex-India HDG prices are in a very wide range of $750-860/mt FOB lately with the lower end of the range ($750-780/mt FOB) corresponding to the best tradable level in some markets like Europe or the MENA region for Z120 coating, while the higher end of the range translates to the small-volume deals to Africa for higher zinc coating.
The sources said that the slight rise in discounts offered by Indian sellers to drive sales was because of mills partially passing on the benefits of the withdrawal of the export tax to buyers. But the price drop was insufficient to push deals in markets like the EU and the Gulf where weak demand has continued to push prices to lower levels.
However, a western India-based exclusive flat steel producing integrated mill has reported a trade for a small volume to South Africa at $855-860/mt FOB. Another Maharashtra-based mill reported a deal for 5,000 mt for Nigeria at $855/mt FOB and 10,000 mt to Egypt at $865/mt FOB. The zinc coatings in these deals were above the benchmark Z120, which explains the higher price level. According to sources, deals were done for HDG with coating ranging between 200 to 270 gms/sq meters.
“Indian mills have worked hard on developing a presence in Africa through intensive marketing initiatives. Though volumes are low, these initiatives are yielding results as select buyers have developed confidence in Indian suppliers,” an official at a private mill said.
“Inquiries from the Gulf and the EU have all dried up. We are robustly developing markets in Thailand, Philippines, Nigeria, Egypt and South Africa. Africa has shown very positive results. But finding sustainable alternatives to the Gulf and the EU in terms of volumes will take a lot more work,” he said.
However, according to an official with a government-run mill, most producers do not have much export allocation for months in the current fiscal year and hence are under less pressure to keep pushing volumes at discounted prices.