Indian mills have attempted to nudge up hot rolled coil (HRC) export prices, not on the back of improved demand but rather given the temporary halt in price declines in some destinations like Europe and the improved sentiments from the withdrawal of the export tax. But new deals that have come to light, which reflect an improvement in export sales from India after a long pause, have been signed at slightly lower levels than those voiced by mills last week, as SteelOrbis has learned from trade and industry circles.
Ex-India HRC prices have settled in the range of $525-545/mt FOB compared to offers quoted at $535-550/mt FOB late last week. A number of deals have been reported as having been done in this new price range, though volumes have been moderate. Even though mills have had to adjust prices from the initial targets, this level is still better than the levels a week before - $518-530/mt FOB.
According to sources, demand in regions like the EU and the Gulf continued to remain weak, but the sharp declines in prices seem to have been checked, providing Indian mills with a window to attempt to push some volumes.
A deal for 30,000 mt of ex-India HRC was concluded by a private mill for early January shipment to the UAE at $560-570/mt CFR, which translates to $525-530/mt on FOB basis. Though initially this deal was discussed in the market as having been signed at $610/mt CFR, a number of market participants agree that the price does not fit the market at all. “It would be hard to get more than $560/mt CFR from the Gulf now,” a large mill source told SteelOrbis.
Trade circles said that an eastern India-based mill reported a trade for a smaller volume for Italy at around $535-540/mt FOB and the same mill also concluded a deal for 5,000 mt to Rotterdam at $543/mt FOB, though the final CFR prices have not been disclosed by the time of publication.
The most competitive offer from one Indian mill to Asia was at $550/mt CFR Vietnam, which corresponds to $525-530/mt FOB at the lowest. Moreover, a western India-based mill reported a trade for delivery to Vietnam at $530/mt FOB, but the deal or the volume could not be confirmed in the market as most customers in Vietnam have been focused on purchases of limited volumes from local sources at $545-555/mt CIF/CFR.
“Much of the current export trend in based on sentiments and expectations rather than on the fundamentals of demand and supply in key markets. Hence, we do not assess much change in mills’ export allocations for January-March, as recessionary pressures and energy costs will continue to weigh on manufacturing in western markets,” an official at a private mill which did not conclude any export sales this month said.
“Low offers from China owing to Covid and political factors can change within a short time and hence pressures on prices will resurface,” he said.
