In a quick reversal of pricing strategy, Indian exporters of hot dip galvanized (HDG) marginally have lowered their offers by $10/mt during the past week to $770/mt FOB, without making any material difference to lack of business in the local market, traders said on Thursday, January 25.
“Having increased offers significantly earlier in the month by $30/mt to offset rising input costs, exporters reversed their pricing strategy as buyers had virtually deserted the local market,” a Mumbai based trader said.
“HDG exporters are caught in a bind either way. The lowering of offer is too little because ex-China HDG offers are also softening at a faster rate and local market is unlikely to see a revival even after the latest cuts in offers,” he added.
According to two other traders, HDG prices are consolidating in US markets and Indian domestic steel mills are receiving enquiries from US buyers but transactions are failing to conclude as discounts demanded by buyers are not being met by local exporters.
At the same time, the Indian currency has been strengthening against the US dollar and at levels of around INR 63.50 a dollar is also an additional disincentive for exporters to push volumes overseas, the traders added.