Indian hot rolled coil (HRC) export activity has remained at a standstill amid vastly differing assessments of acceptable prices from buyers and sellers, SteelOrbis learned from trade and industry circles.
Ex-India HRC prices have been largely maintained at $870-890/mt FOB and only limited volumes are available at $860/mt FOB, which is mostly due to higher freight, rather than actual visible discounts from producers.
Sources said that Indian integrated steel mills were seen to be unwilling to cut export prices, maintaining a positive outlook towards prices seeking higher levels in the wake of China cancelling export rebates on flat products and the possible introduction of an export tax on HRC, which could actually push up prices in the global market. Also, having increased domestic HRC prices riding on back of a slight demand revival in local sales, Indian mills are under less pressure to push volumes overseas unless at higher price realizations.
But buyers in key Asian markets including major destinations like Vietnam remain unconvinced, maintaining a bearish outlook in view of the spread of the pandemic in the region and major concerns that demand will contract, the sources said.
“Domestic demand and sales will once again be back in the focus of most steel mills. The expected demand and price rebound will enable mills to make strategic export allocations in the current quarter and push volumes only if the price is right. We assess that international prices will re-align at higher levels, while total offered volumes from China are also slowing down,” an official from ArcelorMittal Nippon Steel Limited said.
“The outlook for demand for ex-India HRC remains positive for the EU, as soon as new tariff quotas kick in for the next quarter, as supplies continue to be tight in the region. Indian exporters are hence waiting and watching,” he said.
Among a nominal deal concluded during the past week was a trade reported by an eastern India mill for around 10,000 mt to Asia at $860/mt FOB, market sources said. The slightly lower price could be connected with higher freights, sources have said, with no change in the price on CFR basis.