Large Indian integrated exporting steel mills have maintained their hot dip galvanized coils (HDG) export prices unchanged and provided small discounts to conclude deals, anticipating an improvement in timelines for end-of-May deliveries and amid reports of at least one successful memorandum of understanding (MoU)-based export contract, SteelOrbis has been informed on Thursday, April 16.
According to traders, while demand in key overseas markets like the Gulf has remained weak, the export trading environment has showed slight signs of improvement, with Indian steel mills able to offer delivery commitments beyond May and early June.
Market sources said that Indian HDG export prices have been maintained in the range of $520-525/mt FOB and, though most of the small-volume contracts were at the lower end of the range, the sources said that these were concluded only with additional discounting averaging at $5-10/mt.
According to the sources, a western India-based steel mill concluded an export contract for 4,000 mt at $520/mt FOB plus an additional discount of $5/mt, but the delivery timeline was kept ‘open’ and to be set later this month, given the curfew situation in the UAE. However, the Indian steel mill was hopeful of completing delivery by early June, the sources added.
The same steel mill also concluded an export contract for 7,000 mt for end-of-May delivery, with an Asian buyer after offering an additional discount of $7/mt on FOB basis, the sources said.
Reports in the market suggest that at least one integrating steel mill which had been negotiating MoU-based supply contracts was able to finalize terms of sales over the past week even though the identity and location of the buyer was not disclosed due to ‘buyer-seller’ confidentiality. However, sources indicated that the terms finalized were based on future supplies at a pre-determined price range agreed between the buyer and seller.
It is difficult to forecast if this single contract will set a trend in HDG exports, considering uncertainties regarding the post-Covid-19 international trade environment and the medium-term direction of finished steel prices in various markets, the sources added.
