Indian exporters’ hot dip galvanized (HDG) coil prices have marginally increased by around $10/mt during the past week to $760/mt FOB, riding on the hardening of ex-China offers and the slight revival of flat product prices in Gulf markets, even though demand has remained tepid, traders said on Thursday, April 26.
“The increase in ex-India HDG offers has been cautious since there is little demand from either the US or Gulf buyers,” a Mumbai-based trader said.
“Indian exporters have gone in for a hike to be in line with overall trade trends, although no significant export transactions have been reported during the past week with just some small-volume deals reported for shipment to Southeast Asia,” the trader added.
But at least two other traders said that the slight revival in prices in the Gulf Cooperation Council market is not backed by any significant rise in demand as buyers in the region are possibly postponing higher-volume transactions until after the month of Ramadan which starts in mid-May.
These traders said that the increase in HDG offers by Indian exporters is also significant as the Indian rupee has been rapidly depreciating and threatening to breach the INR 67 to the dollar mark, and is an indication that exporters are eager to maximize margins even through low-volume shipments.
At the same time, with demand and prices remaining strong in the domestic market, exporting steel mills are focusing on domestic sales, while in comparison the incentive to export offered by the rapid depreciation of the Indian rupee against the dollar is not so significant, the traders added.