Indian integrated steel mills have aggressively pushed up hot rolled coil (HRC) export volumes. They have reduced their initial offers and have managed to sell around 250,000 mt of HRC mainly to Asia over the past week ending on June 1. Most deals have been done at above $400/mt FOB and suppliers have increased offers further on Monday, seeing improved demand from China, SteelOrbis has learned on Monday, June.
According to traders, in view of the hikes in futures prices and some shortage of re-rolling grade HRC in the Chinese market, Indian exporters were able to increase average tonnage bookings for August shipments. Deals have been done in the range of $395-410/mt FOB and offers have increased to $415-422/mt FOB on Monday, June 1.
At least three traders confirmed that total aggregate bookings received by Indian steel mills over the past seven working days are estimated at 250,000 mt for July-early August shipments, indicating a strong buying appetite among Chinese traders.
According to market sources, a western India-based steel mill concluded contracts for an estimated volume of 80,000 mt with Chinese buyers at a price of around $398/mt FOB, which corresponds to $410/mt CFR China and slightly above. Two different mills managed to conclude deals later in the week at $420/mt CFR China (translates to $408/mt FOB), one of them for 40,000 mt.
An Indian mill has signed a deal for 25,000 mt of HRC for August shipment to Vietnam and another contract for 20,000 mt has been done to Taiwan. The price in both these contracts was above $405/mt FOB.
Another Gujarat-based steel mill has received a booking for 30,000 mt with Singapore based trader at $405/mt FOB.
The same mill has also received a booking for August shipment from EU-based buyers for an estimated volume of 35,000 mt at a price range of $400-405/mt FOB, with sources saying that the deal indicated a gradual revival of manufacturing in the EU region, which would provide further support for ex-India HRC prices.
“There is heavy trading in the Chinese market. Hence, Indian exporters have been able to increase the number of deals and tonnages in sales to Chinese buyers. The trend is expected to be sustained as China’s recovery will be fast. In addition, the revival of buying from the EU region will also continue to support ex-India prices and enable local steel mills to sustain viabilities amid extremely weak local demand, which will not see a revival for at least two quarters,” a manager at one Indian mill told SteelOrbis.
New offers for Indian HRC to Chinese buyers have been at $430-435/mt CFR or $418-422/mt FOB and, according to sources, the new level may be reflected in new deals as local prices for coils in China have kept increasing. Average local prices in China have increased by RMB 55/mt ($7.7/mt) on Monday, June 1, according to SteelOrbis’ information.
