Indian exporters of hot dip galvanized (HDG) coils have dropped prices aggressively on top of adding deep discounts to offers to push small-volume trades in the Gulf region even as the outlook in the EU has worsened from reports of cutbacks in outputs planned by auto manufacturers responding to the gas supply crisis, SteelOrbis learned from trade and industry circles on Thursday, July 28.
Ex-India HDG prices have been cut to $850-900/mt FOB for grades of 0.5-1 mm and a coating range of 220-275 grams per square meter (GSM), while the official offers have been heard at $950/mt FOB. The tradable level has been closer to the lower end of the range, according to sources.
According to sources, the average deal size of trades did not exceed 2,000-5,000 mt indicating a sustained lack of confidence among buyers and only very few sellers have been willing to conclude sales overseas at steep discounts, considering higher costs of production of local mills and their inability to match the aggressive pricing of ex-China offers.
Sources said only one eastern India-based mill was active in the export market, reporting one trade for 2,000 mt with a Bahrain-based trading firm for early September shipment at around $880/mt FOB. The second deal reported by the seller was for 4,000 mt to a GCC-based buyer at around $860/mt FOB.
“The gas crisis in Europe and the announcements of a few German automobile manufacturers planning output cutbacks in response have dampened any optimism over revived demand from the region once new tariff quotas are announced for the next quarter,” an official at a private Indian mill with an affiliate steel mill in the EU said.
“Only a very few mills can push volumes at current prices net of large discounts. Most local mills are not submitting offers because export allocations from rolling mills have been cut down,” he said.
