Indian hot rolled coil (HRC) exporters have continued to cut prices, reacting to the slowdown in domestic sales and widespread resistance to higher prices in key destinations in the MENA region and the EU, where buyers were reducing imports unless sellers agreed to significant discounts, SteelOrbis has learned from trade and industry circles.
Ex-India HRC prices have ranged at $930-1,050/mt FOB with the midpoint at $990/mt FOB, down from levels of $950-1,100/mt FOB reported late last week. Most deals to the MENA region were done close to the lower end of the range, while new contracts to Europe were signed at $1,050/mt FOB at the highest, posting a decline of around $50/mt from the previous sales.
“Dynamics in the Gulf, the EU and North Africa are all shifting from a sellers’ market to a buyers’ market. Demand growth in these destinations is not as strong as even a month ago giving rise to strong resistance to high prices,” a source at a private integrated mill said.
“There are sharp declines in both achievable prices and volume bookings for Indian exporting mills. In reality, these mills are heard to be accepting any bids as domestic sales volumes are deteriorating. Inventory management is back in focus,” the source said.
An official at another mill pointed out that India, having almost vacated Asian markets where achievable prices are still far below $900/mt FOB, exporters have little option but to accept lower bids from the EU and the MENA region which still ensured comparatively higher realizations.
Trade circles said that a mill confirmed a booking to the UAE at $1,000/mt CFR for 10,000 mt, which translates to $940/mt FOB or below. In addition, a contract to Oman for 10,000 mt was done at $1,000/mt CFR as well. Bids from the Middle East have fallen further this week, sources have said.
Also, one ex-India offer at as low as $1,010/mt CFR has been reported to Turkey, which, however, has been assessed as too low for most of the mills.
A contract to one of the European customers was done at around $1,200/mt CFR or $1,100/mt FOB, as SteelOrbis reported late last week. However, according to some sources, another deal to Europe has already been done at $1,150/mt CFR, which, however, could not be confirmed by the time of publication. This price translates to $1,050/mt FOB.
Also, one of the mills has been heard negotiating a sale to Italy at $1,000/mt FOB, but it is also still unclear whether this deal was done.