Indian exporters of hot dip galvanized (HDG) coil have maintained their offers unchanged at $635/mt FOB, but have resorted to hefty discounts and have pushed higher volumes in the Gulf Co-operation Council (GCC) markets, traders said on Thursday, January 24.
Market sources said that, in view of the soft demand in GCC regions, Indian traders who export HDG have been observed to be offering very high discounts in the range of $20-25/mt to successfully increase shipment volumes to the region.
“Not only demand in the Gulf continues to be low, but buyers are very price-sensitive. Alongside the need of Indian traders to liquidate inventories as the fiscal year draws to a close, higher discounting to push volumes even at lower margins has seemed the only option for the Indian exporters,” a Mumbai-based trader said.
“Indian exporters have also been helped by the fact that Chinese exporters have largely stayed away from submitting offers during the past week,” the trader added.
However, according to two other traders, the slight increase in Gulf contracts riding on higher discounts is unlikely to be sustained in the medium term as prices are expected to come under renewed pressures with supplies slated to increase in view of the safeguard duty imposed by the EU and Indian traders will be hamstrung in further adjusting offer levels to keep pushing volumes overseas.