Tight competition with Indian, Russian and South Korean hot rolled coil (HRC) suppliers has once again pushed prices for ex-Japan HRC down, for December shipments. As allocation will still be high in Japan till December, suppliers try to be competitive.
Japanese mills have been offering SAE1006 HRC at $410-420/mt FOB, while some big traders have been ready to give $400/mt FOB for some destinations or even slightly lower. Offers in late September were $20-30/mt higher. “Japanese suppliers have to cut prices to get contacts. The main factors influencing the market are not many customers ready to negotiate and still high influence of India,” a Japanese trader said.
The lowest Japanese HRC offers heard to Vietnam have been at $430/mt CFR, with some volumes already been sold at this level.
Some negotiations have been heard in Europe at $435/mt CFR, but there have been no information about deals.
In neighbouring markets like Bangladesh and Malaysia prices from Japan are higher at $460-470/mt CFR, for December shipments, which is at least $10/mt below the level for November shipment HRC. “Indian suppliers have been already selling at $450/mt CFR Malaysia,” a trader from Malaysia said.
Usually Japanese mills have maintenances in December, so they are expected to be less aggressive on their offers for January shipments. It also means that exporters will try to sell HRC faster for December shipment.