Buoyed by a few mills determining higher export allocations for May bookings, a second base price increase for flat products in the local market and sustained robust demand, Indian hot dip galvanized (HDG) coil exporters have become more aggressive in ramping up prices, SteelOrbis learned from trade and industry circles on Thursday, March 17.
For the second consecutive week, exporters have increased prices sharply, by $60-100/mt this time over the past week to $1,200-1,270/mt FOB, with mills booking higher volumes in trade with EU buyers and supported by the slight revival seen in the Gulf market.
“Some mills have finalized significantly higher HDG export allocations for deliveries beyond May based on two rounds of increase in prices of hot rolled coil (HRC). Sellers are still able to get premiums ranging at $20-30/mt from EU buyers for deliveries at the end of April or in early May. The landed price of Indian exports is still $100-200/mt lower than local prices since most EU mills have effected strong price increases,” an official at a private mill said.
“Gulf buyers were returning, but volume trades are comparatively low as there are apprehensions of project deferments in view of rising oil prices and supply chain disruptions that could trigger a softening of demand and importing distributors are cautious over inventory levels,” the official said.
However, at least two officials at local mills pointed out that, apart from demand, the cost push, particularly for zinc now prevailing at a 15-year high, is also forcing mills to increase HDG prices aggressively. They said that zinc demand from mills is up 12 percent in the current year and, with sourcing from Russia coming to a halt, there has been a significant tightening of supplies.
Sources said that an eastern India-based integrated mill has reported a trade for 18,000 mt with a North Africa-based trading firm for end-of-May delivery at $1,200/mt FOB.
The same mill is also heard to have concluded a trade for 10,000 mt for Rotterdam at the week’s highest price of $1,270/mt FOB, sources said.
A trade for 5,000 mt has been reported by a western Indian mill to the Middle East at $1,190-1,200/mt FOB, the sources said.
