Indian export offers for hot dip galvanized (HDG) coils have remained unchanged at around $880/mt CFR US amid low market activity, traders said on Friday, May 23.
"The export business has lost its attraction with the Indian rupee at an 11-month high against the dollar," a Mumbai-based trader said.
"The steadily appreciating rupee has eroded the price competitiveness of Indian HDG in the US market," the trader said.
"Local exporters are unable to lower prices and push volumes. Small transaction volumes have been concluded at nominal margins just to maintain a market presence," he added.
Sources said that the gains of the rupee against the dollar have made it very difficult for exporters to ensure a stable pricing strategy and current offer levels are not acceptable to buyers.
Even though the Reserve Bank of India (RBI) intervened during the week, buying up dollars to cap the strength of the Indian currency, current levels of INR 58.50 against the dollar are still too high for Indian HDG to be price competitive, sources said.
Only rupee exchange levels of INR 60 or above to a dollar could push HDG exports, ensuring sufficient margins for exporters, the sources added.