Indian hot dip galvanized (HDG) coil exporters have continued to nudge up prices reacting to tight supplies and rising local prices of hot rolled coils (HRC), but have been successful only in a few limited discounted deals to African destinations, SteelOrbis has learned from trade and industry circles.
Ex-India HDG prices have been pushed up for the second consecutive week by $10-20/mt to the range of $860-880/mt FOB, but overseas sales have continued to remain unviable for sellers. As a result of still lower bids, the SteelOrbis reference price has been lowered by $10/mt over the past week to $865/mt FOB on average. The price decline is due to the absence of overpriced offers at $900/mt FOB seen last week, and lower deal prices at $850-855/mt FOB.
An official at a private mill said, “The rapid rise in local HRC prices and the tightening on the supply front along with the relative slower pace of increase in the case of HDG has sharply reduced the differential between the two, which is actually the value-addition realization. Hence, with the margins of value addition being restricted, mills are finding it more lucrative to push local sales of HRC and are reducing output of downstream production.”
“Ex-India HDG remains price-competitive in the EU and West Asia. But with demand in downstream industries sluggish and uncertain from recessionary pressures and energy costs, buyers are few,” he said.
Trade circles said that a Gujarat-based mill has reported a trade for 10,000 mt for November delivery to Egypt at $550/mt FOB net of discount and on a par with prices earlier in the month.
Another eastern region-based mill has reported a trade for 5,000 mt for delivery to South Africa at $555/mt FOB, net of discount, the sources said.
