Indian hot dip galvanized (HDG) coil exporters have maintained prices at higher levels of $525-530/mt FOB during the past week, but trades have been limited to not more than a couple of deals in the face of buyers’ resistance, anticipation of a price correction, and the fall in business activity in key markets like the Gulf, SteelOrbis has learned on Thursday, July 23.
Traders said that, while Asian buyers have declined to conclude transactions at the current high prices of ex-India HDG and expect prices to be adjusted down shortly, buyers in the Gulf have preferred to defer trades in view of the forthcoming holidays in the region.
According to an official at a western India-based steel mill, the lull in trading activity is temporary and the downside risk will be much less than that anticipated by buyers largely owing to the increase in the pace of resumption of manufacturing activities in the EU supported by a recovery fund.
Bookings from EU buyers, though for limited volumes so far, have been sustained and can only gather momentum going forward in response to the recovery fund, and hence the downside risks from cautious Asian buying will be limited and local integrated steel mills have preferred to keep their export prices stable.
Market sources said that a western India-based steel mill concluded a deal for an estimated volume of 12,000 mt with a EU-based trading firm at around $527-530/mt FOB.
Another steel mill also based in the west concluded a deal for 10,000 mt with a Gulf-based trading firm at around $525/mt FOB, the sources added.