Indian steel mills have sharply cut hot rolled coil (HRC) prices over the past week and have managed to sign a few deals with customers in Southeast Asia and the Middle East, SteelOrbis has learned from trade and industry circles. Nevertheless, overall buying has not been at high levels and exporters have just gradually started to regain competitiveness. The general moods are still bearish for the near future.
Ex-India SAE1006 HRC prices have dropped to $740-800/mt FOB, down by $22.5/mt on average from last week’s level of $770-815/mt FOB. The lower end of the range corresponds to the deal price level to Asia, while the highest corresponds to the prices in the Middle East.
One of the major Indian mills sold at least 20,000 mt of SAE1006 HRC at $790/mt CFR late last week, a number of sources said, this is compared to the lowest offers from India to Vietnam at $815-820/mt CFR a week before. This $790/mt CFR corresponds to $740-745/mt FOB, but has been assessed as the lowest in the market for now, while most other mills have been asking for at least $20/mt higher.
The sources said that the majority of ex-India HRC prices have been slashed to levels of $750-760/mt FOB, but have still failed to meet buyers’ expectations in the Asian region.
But, on the other hand, some trading has also been seen to the Middle East after the latest price declines. A few deals for at least 40,000 mt of Indian HRC have been done at $825-840/mt CFR. With freight at around $40/mt, the FOB price is $785-800/mt FOB.
The latest offers for ex-India HRC to Turkey have been reported at $835/mt CFR, down from $850-855/mt CFR earlier, but without the response from buyers.
Indian mills have also been offering at €800-810/mt CFR to Europe, down from €830/mt CFR earlier in December, while buying activity has been poor.
“Indian mills are lowering prices to entice buyers overseas. But even after price cuts, there are sharp differences over acceptable valuations in many cases. Buyers in markets like Vietnam are expecting further declines in global prices,” a source at ArcelorMittal Nippon Steel Limited (AMNS) said.
“Indian steel exports were down 32 percent in November on month-on-month basis and the trend is continuing in December. Decreases in ex-China prices are putting pressure on Indian exports. Indian mills have limited headroom to push sales overseas in view of higher input and infrastructure costs,” the sources said.
