Indian hot dip galvanized (HDG) coil exporters have effected one of the most aggressive price increases in recent times in the past week, supported by the rise in buying from the UAE, Saudi Arabia and Italy in a market completely dominated by sellers, SteelOrbis learned from trade and industry circles on Thursday, March 24.
Indian mills have increased prices by $70-100/mt to $1,300-1,340/mt FOB, with several in trade circles claiming that such price offers are ‘notional’ as some confirmed trades have been heard at higher levels of $1,400/mt FOB as sellers are “in complete control of the market” and have even been lowering volumes on offer against bids to secure greater leverage in price negotiations.
“Any seller who has exportable volumes for April-May shipment is attempting to strongly leverage higher pricing. Exports have become the most viable option for mills to recover continuously rising costs of production,” an official at a private mill said.
“Buyers, particularly some EU countries and the MENA region are reconciled to a new high-priced market regime, expecting a prolonged supply chain disruption and a sustained shortage in the market. There are also very limited volumes available from the EU mills,” he said.
Middle Eastern buyers are facing a shortage owing to reduced exports through the Black Sea, while mills in the EU are increasing prices but do not have sufficient volumes to replace import demand, and hence a lot of buyers are shifting to India, but sellers in India are unable to meet the total volumes requested by buyers.
Sources said that a Gujarat-based mill has concluded a trade for 12,000 mt, reduced from an original bid for 20,000 mt submitted by a UAE buyer at $1,300-1,340/mt FOB.
The same mill has also concluded a deal for 15,000 mt with an Italy-based buyer for May at as high as $1,400-1,420/mt FOB, but this was heard in the market and has not been confirmed by the seller.
An eastern India-based mill has reported a deal for 10,000 mt with a buyer from Qatar at a price of $1,320/mt and another tonnage for 8,000 mt with an EU-based buyer at $1,300/mt FOB, sources said.
