Ex-India hot rolled coil (HRC) prices for major overseas buyers have been nominal lately as trade activity has remained stalled amid soft demand and low prices in Southeast Asia and uncertainties over available quotas in Europe, while export allocations have been kept at negligible levels due to robust local demand and sales backed by tightening supplies, SteelOrbis learned from trade and industry circles on Tuesday, September 22.
Ex-India HRC prices have been reported at $550-640/mt FOB, up slightly from $540-640/mt FOB late last week, but this level is nominal as firm offers are very few. Quotes at the highest end of the range are applicable for Europe, but large local mills have not been pushing sales overseas even at this level in face of the mounting backlog in completing deliveries against past bookings for domestic consumers.
It was pointed out that, with domestic HRC trade-level prices moving higher than $640-650/mt ex-warehouse including taxes plus premiums charged for ready deliveries, export sales are unattractive and unviable for example in Vietnam where buyers have been seeking discounts to conclude sales at $520-530/mt FOB and below.
The latest sales from India were done only to Europe at $700-720/mt CFR, as SteelOrbis reported last week. But a few market participants said that the higher end of the range was too high considering that any current sale may be outside the available tariff quota for the fourth quarter. The shipment period is heard to be October, so it is very close to the end of the year in terms of delivery and time is needed for customs clearance, so market sources agree that a good volume at ports may be left for the first quarter quota.
“The Indian market is far outstripping what overseas sales have to offer currently. Why would any seller export at discounts when inventories are low and there is backlog in supplies? ” a representative of an Indian mill said.
“There is a lot of aggressive discounted selling in some regions. Indian mills are happy to sit back at home and leverage the robust demand growth,” he added.
