Indian integrated steel mills have been seen attempting to increase their hot dip galvanized (HDG) coil export prices during the past week, but spot bookings have come to a standstill as the focus has shifted to long-term supply contract agreements with buyers in the European Union (EU), sources told SteelOrbis on Thursday, September 24.
Traders and market sources said that Indian integrated steel mills have increased prices by $10/mt to $580-590/mt FOB largely in response to tight supplies of hot rolled coils (HRC) in the local market, even though ex-China HDG offers have remained soft.
Buyers in key markets like the Gulf and Southeast Asia have largely stayed away from concluding transactions, anticipating prices will seek lower levels as Chinese exporters force higher shipments at lower price levels. However, despite low trading activity, the focus among Indian exporters has shifted to securing long-term supply contracts with buyers in the EU, largely triggered by lower availability and stronger demand from the European auto industry, market sources in India have said.
The sources said that, though local integrated steel mills did not officially announce details of concluded long-term supply agreements with EU buyers, market participants indicated that normally such contracts are on average 1-3 percent lower in price than ruling spot booking prices.
Market sources said that a western India-based steel mill has concluded a trade for an estimated tonnage of 12,000 mt at a price of around $580-585/mt FOB with an Antwerp-based trading firm. The sources said that the deal was concluded through the intermediation of a European affiliate of the Indian steel mill.
An eastern India-based steel mill has concluded a contract with a Gulf-based buyer for a modest tonnage of 8,000 mt at around $585-590/mt FOB for December delivery, the sources added.