Indian HDG exporters cuts offers but buyers consider adjustments too small to make fresh bookings

Thursday, 18 July 2019 15:39:10 (GMT+3)   |   Kolkata

Indian hot dip galvanized (HDG) coil exporters have lowered their offers by $10/mt week on week to $610/mt FOB, but have been limited in their ability to ship significant volumes in face of the sharper price fall in key target markets like the Gulf, traders said on Thursday, July 18.

Market sources said that, with both demand and prices falling sharply in Gulf Cooperation Council (GCC) markets, buyers have been seeking deep discounts even after offers were adjusted, but few Indian exporters have been willing to agree to such discounts, resulting in only nominal volumes being contracted during the past week.

The sources said that, even though ex-China HDG offers have remained stable in contrast to the cuts in ex-India HDG offers, buyers have been unwilling to conclude deals so as not to build up high-cost inventories against the backdrop of sluggish demand.

“Neither Indian traders nor large Indian steel mills have been aggressive in seeking to conclude export contracts even after lowering their offers. This is largely because the strength of the Indian currency against the dollar has not offered any opportunity to compensate for a sacrifice in margins after pruning offers,” a Mumbai-based trader said.

“In Southeast Asian markets, buyers have been waiting for a price direction in view of ex-China offers remaining stable even amid weakened market conditions. This has prompted lower interest in ex-India HDG even after the price adjustments which buyers have felt were too small to conclude transactions for significant volumes,” the trader added.

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