Indian hot dip galvanized (HDG) coil exports have fallen silent over the past week in the face of firm ex-China offers, barring one domestic mill which was successful in concluding sales to the EU only after dropping its prices, SteelOrbis learned from trade and industry circles on Thursday, December 1.
The sources said that a western India-based integrated mill concluded two deals through its EU-based affiliate trading firm. The first tonnage of 12,000 mt for delivery to Spain was reported at $820-830/mt FOB, while the second trade was for 15,000 mt for delivery to Italy at around $820/mt FOB. Both deals have been done for HDG with zinc coating of 220 gms minimum.
These trades were significantly lower than the prices reported in the range of $850-860/mt FOB a week ago in deals to Africa, also for higher quality materials.
In such situation, taking into account the premiums for higher zinc coatings, the indicative price level for Z120 HDG from India has been cut to $720-740/mt FOB, while last week the lowest level for Z120 coils was at $750/mt FOB.
“More ex-China offers are being reported in most markets amid sustained weak demand particularly in the Gulf and the EU. It is big challenge for Indian mills to push higher volumes in the absence of any demand improvement in the Gulf,” an official at a private mill said.
“The lowering of ex-India prices is also a factor for the weakening of HRC prices, both in domestic and overseas markets. The withdrawal of the 15 percent export tax has also enabled mills to be a bit more aggressive and to increase competitiveness in sales overseas,” he said.
However, according to a trade source, there has been some improvement in HDG bookings by domestic automobile manufacturers as the latter are reporting improved exports of passenger cars, which mandatorily require higher usage of the material.