Following more than six months of price decreases, prices for Japanese hot rolled coil (HRC) in the export market have finally started to move up over the past month given better demand in the local and overseas market. Besides, even though by the end of December sentiments have started to worsen in the Chinese market, Japanese exporters are aiming to increase HRC prices further for early February shipment. However, most of them are in a waiting position now and are not widely giving firm offers.
Offers for ex-Japan SAE1006 HRC to Asian customers have risen to around $640-660/mt CFR in late December, compared to $550-590/mt CFR in late November. The lower end of the range corresponds to the spot offers to Vietnam, though, according to most Vietnamese buyers, “now mills have stopped offering and will hike prices”. Meanwhile, the higher end corresponds to offers in Pakistan and Bangladesh. “Ex-Japan offers at $600/mt FOB reflect their idea for the next round, but no booking has been heard at this level so far,” a Pakistani trader told SteelOrbis.
“The market price seems to be picking up after a long period of price declines over the last several months, mainly amid better demand in higher-priced destination, such as Europe and the Middle East, though falling futures in China could be an issue in the near future,” a Japanese trader said.
In the meantime, according to sources, after a deal for around 15,000/mt of ex-Japan SAE1006 HRC was signed at $610-620/mt CFR UAE last week, while new offers have increased to around $625/mt CFR. However, according to market insiders, Japanese mills aim to increase prices further to around $640-650/mt CFR. This means growth by $65/mt on average over the past month.
Japanese HRC suppliers have continued to focus on the European market in December as well, increasing their offers to around €640-650/mt CFR southern Europe, up by €40-50/mt month on month. “European producers have been intending to increase their local HRC prices, and, surprisingly by the end of the month, higher prices have been accepted by buyers. However, import trade still remains limited due to the long transportation period,” an Italian trader told SteelOrbis.
Offers for ex-Japan HRC in South America have been voiced at $650-670/mt CFR Pacific coast, compared to $595-605/mt CFR one month ago.
