Indian integrated steel mills have marginally lowered hot dip galvanized (HDG) export prices during the past week as buyers from the EU have continued to stay away and buyers in the Gulf region have been reluctant to accept higher prices.
According to market sources, integrated steel mills have cut export prices by $10/mt to $520-525/mt FOB, but even the limited deals concluded have been at discounts as buyers in the Gulf and Southeast Asia are refusing any price higher than $510-515/mt on FOB basis.
The sources said that, despite lowering export prices, integrated mills have not been aggressive in pushing volumes overseas and most of the discounted deals were for low volumes as local steel producers are instead focusing on meeting strong export demand for thinner gauge hot rolled coil products.
The sources said that a western India-based steel mill has concluded a deal for 8,000 mt for September delivery with an Asian buyer at a price of around $510/mt FOB net of discount.
Another rolling mill has concluded a transaction for 7,000 mt with a Dubai-based trading firm reportedly at a price ranging at $510-512/mt FOB for end-of-August delivery, the sources added.
“Resumption of manufacturing in the EU region and restocking of raw materials is below expectations. Auto majors are cautious in committing import transactions as sales during May have also been below expectations and HDG prices have become very price sensitive,” an official at JSW Steel Limited said.
“As the price differential between HRC and HDG narrows, lowering value-addition margins, steel mills have been more inclined to push higher volumes of thinner gauge HRC overseas,” he added.
