In one of their most aggressive moves to compensate for weakening domestic demand, Indian integrated steel mills pushed up their hot rolled coil (HRC) export prices to key Asian destinations over the past week, while higher offers still persist for EU-based buyers, although with limited trades concluded, SteelOrbis has learned from trade and industry circles.
With the low presence of Chinese HRC exporters in Southeast Asia, Indian suppliers have been adopting a more aggressive policy, attempting to push up export prices above $800/mt CFR.
The general price range for ex-India HRC has remained wide at $770-870/mt FOB, up by $30/mt over the past week, with both ends of the range posting an increase amid improvements in Asia and the EU.
Offers submitted by Indian integrated steel mills have averaged at $790-820/mt FOB to Asia and the Middle East, but actual trades have been concluded at a lower level, at $770/mt FOB or slightly below, which is still higher than trades a week ago that were reported in the range of $740-750/mt FOB with Asian buyers.
“The attempt to push up prices by Indian exporters is natural considering that the landed price of HRC in most Asian markets is still lower than the comparative landed price for EU buyers. The issue of a tax rebate cut for Chinese exporters is also far from clear. At best, it will not be scrapped, but reduced, which still makes it risky for buyers to commit to an offer now and Indian exporters are attempting to fill the breach,” an official at ArcelorMittal Nippon Steel (AMNS) said.
Sources said that the latest deal for Indian HRC has been signed at $805/mt CFR to Vietnam, which translates to about $770/mt FOB. This means that Indian mills have managed to achieve a $25/mt increase compared to the previous deals to Vietnam. Negotiations with Asian buyers are starting from $780-790/mt FOB at the moment, sources said.
At the same time, HRC prices have kept going up in the European market amid still tight supply. However, sources said that, despite high prices, the shortage in the EU region and strong import interest, actual trading activity from India is limited, though sellers have continued to maintain a bullish outlook, banking on a revival of bookings of ex-India HRC once new quota allocations will kick in.
A western Indian-based exclusive flat steel producer reported a small tonnage trade to the EU at $860/mt FOB, sources said. Moreover, at the moment, the tradable level for Indian coils has already reached $920-930/mt CFR in southern Europe, which is around $870-880/mt on FOB basis.