Indian integrated steel mills have continued pushing up hot dip galvanized (HDG) export price in the past week, increasing them by $5/mt to $525-530/mt FOB, to align them with the hardening of flat product prices for local sales, though they have faced a demand weakening in some key markets, SteelOrbis learned on Thursday, July 16.
According to traders, the export price increases over the past two consecutive weeks were expected in the wake of local steel mills’ hikes in domestic hot rolled coil (HRC) prices to maximize margin realizations, but buyers’ response in key markets like the Gulf has remained weak although it is difficult to gauge whether this was the effect of buyers’ resistance or a general fall in business activity ahead of the religious festival holidays later this month in the region.
However, continued buying from the EU region, though for lower volume trades, has been a positive, with exporters anticipating this will be sustained as more manufacturing units in the market return to normal production levels and, with ex-India HDG still competitive after prices increases, buying could gain momentum, the traders said.
A western India-based steel mill has concluded a deal for an estimated volume of 8,000 mt with a Gulf-based trading firm at a price estimated by the market in the range of $525-528/mt FOB. The same steel mill has also concluded an end-of-September delivery deal for 5,000 mt with a Singapore-based trading firm at a price of around $527/mt FOB, market sources said.
The sources said that an eastern Indian integrated steel mill has concluded a deal for 8,000 mt with a EU-based trading firm at the higher end of the price range close to $530/mt for early September.
“With local flat product demand and prices firming up, steel mills are aligning export prices too to improve their realizations. With HRC exports continuing to remain very positive both in pricing and volume terms, mills are now more aggressive in improving HDG export realizations too and expect higher prices to be absorbed by buyers with bookings from the EU being maintained, though for small tonnages, and the rise in ex-China HDG prices,” an official at a private steel mill said.