India’s flat steel import market has continued to remain in the doldrums with virtually no market participant willing to make fresh deals in face of currency risks and worsening reports from key consuming sectors, traders said on Thursday, August 15.
“There is no appetite for imports at a time when even domestic material is not moving from stockyards to consumers. With June 2019 factory output growth falling to two percent from seven percent in June 2018 and with the Indian rupee, the worst performer of all Asian currencies, plunging to a six-month low against the US dollar, booking imports is just too risky for end users as well as traders,” a Mumbai-based trader said.
Ex-China hot rolled coil offers have been maintained at lower levels of around $500/mt CFR Mumbai, according to market sources.
However, even though offers have remained unchanged, with the rupee weakening to a six-month low, the landed price of imported HRC has become too expensive to trigger any buying at a time when local traders and end-users are already saddled with high stocks and hence no significant booking volumes have been reported in the market during the past week, the sources said.
The only exception were two western Indian stand-alone cold rolling mills which were reported to have booked nominal ex-China import volumes based on their long-term contracts, but the transaction prices could not be confirmed in the market, the sources added.
No trades have been reported for either ex-Japan or ex-South Korea material even though offers have been maintained in the range of $535-540/mt CFR Mumbai, the sources said. “Even though ex-China and ex-South Korea offers for flat steel products have remained steady at lower levels, this cannot offset the headwinds in the Indian market. Recent comments by US President Trump, clubbing India along with China for taking undue trade benefits have also unnerved local traders here with overseas exposure,” a source added.
Ex-China import offers to India have been maintained at around $510/mt CFR Mumbai, according to market sources.
There have been no significant trades concluded during the past week which is not surprising considering that July 2019 auto sales were down 31 percent, the sharpest fall in the previous nine months and most automobile manufacturers have been closing down production lines or observing weekly shutdowns and hence are not making any import bookings.
In such an environment, traders who are already carrying high-priced stocks have stayed away from any import bookings during the past week, the sources added.
Import steel plate offers to India
Ex-China steel plate offers to India have largely remained unchanged during the past week at $545/mt CFR Mumbai, according to market sources, who said that no trades of any significant volumes have been reported in the market.