Japanese HRC exporters have continued to keep prices high in April. However, the bullishness of Japanese suppliers, who had been increasing prices since February amid higher demand for thin coils in high-priced markets like the EU, has started to slow down in mid-April. Thus, a further uptrend has become questionable considering that most customers in Europe have long-term steel consumption concerns due to lower demand in the auto sector and problems with credit lines, while HRC buyers in other destinations have been focusing on cheaper cargoes from China.
Offers for ex-Japan SAE1006 HRC to Asian customers have reached $1,000-1,050/mt CFR in mid-April, compared to $980-1,100/mt CFR in mid-March. Limited sales to Pakistan have been confirmed at $1,000-1,020/mt CFR. Besides, according to market insiders, several deals have been signed with Bangladeshi customers at $990-1,000/mt CFR this week. Meanwhile, Vietnamese customers said HRC offers from Japan are coming at around $1,050/mt CFR, which are considered to be overpriced, considering that most buyers have been focusing on purchases of cheap cargoes from China at around $900-920/mt CFR.
In the meantime, Europe has remained among the most attractive destinations for Japanese HRC exporters. The latest offers for ex-Japan HRC have been heard at €1,150-1,200/mt CFR southern Europe, compared to €1,200/mt CFR one month ago. “Japanese suppliers have been selling significant volumes of HRC into Europe since February, but now it looks like the uptrend is reversing on an easing of the supply gap caused by the Russia-Ukraine war and weaker demand in the region,” an international trader told SteelOrbis. According to the Japanese Ministry of Finance, in the January-February period this year export volumes of HRC to Spain increased fivefold to 41,054 mt, while exports to Italy showed sevenfold growth to 73,706 mt, year on year.
Furthermore, ex-Japan coils to South American customers have been offered at $1,200-1,220/mt CFR Pacific coast, though the allocations are limited for this destination.
Meanwhile, after ex-Japan HRC supplier were out of the market in the Middle East for almost two months, new deals have been reportedly done at $980-1,000/mt CFR in the UAE this week. “After Japanese traders in the Middle East received the US quota, the chance to sell to the region at lower prices ex-Japan is very slim”, a market insider told.
