Prices for Japanese hot rolled coil (HRC) in the export market have been moving upwards continuously over the past month amid good demand in the local market and still limited allocations for sales abroad. Moreover, taking into account the still bullish outlook in the global market, exporters are aiming to increase prices further for April shipment HRC by up to $50-100/mt, though new levels will hardly be supported by buyers, especially in Asia.
Offer prices for ex-Japan SAE1006 HRC have been moving up in a few separate rounds, touching $850-870/mt CFR for March shipment HRC in the Asian region in the first week of February. This is approximately $50-65/mt above the levels from Japan in Asia in mid-January. Besides, a major Japanese steelmaker has announced its intention to raise its offers for April shipment HRC to around $900-950/mt CFR. Nevertheless, in the Asian market, customers are not ready yet to accept such a high level. “Yesterday, we heard an offer from Japan at around $870/mt CFR, while today we have already heard the $950/mt CFR level. But that price is simply unworkable as offers from other sources are still much better,” a representative of a Vietnamese steel mill told SteelOrbis.
“We heard Japanese suppliers are offering to South Korea at $890/mt CFR and to Pakistan at $900/mt CFR, but buyers can still get lower prices from other countries. Besides, downstream product prices are not increasing,” an international trader said.
Meanwhile, considering that Europe has remained among the attractive destinations, Japanese HRC exporters also plan to increase April shipment HRC offers to $1,000/mt CFR. The latest deal for ex-Japan HRC to the EU was last week at $920/mt CFR to Italy, while this week offers have been heard at $945-950/mt CFR for March shipment. “Just yesterday, Japanese offers were at $945-950/mt CFR,” a market insider stated, adding that a further sharp increase in offers will hardly be accepted for now.
Market sources said that this week Japanese exporters have withdrawn offers to South America, preparing for a further price increase for April shipment to around $1,000/mt CFR. There have been no new offers from Japan to the Middle East and Turkey.
