Pakistani CRC and HDG mills cut prices again amid stronger currency

Pakistani producers of cold rolled (CRC) and hot dip galvanized (HDG) coils have revised their offer prices downwards for the fourth time in October given the continuous appreciation of the national currency against the US dollar coupled. At the same time, in trade activity the import HRC segment has remained weak due to the issue regarding letters of credit (LCs), with only occasional deals reported for ex-China SS400 HRC at lower levels.

More specifically, following a PKR 8,000/mt ($28/mt) decrease announced two weeks ago, this week local prices for CRC and HDG have decreased again, but this time by as much as PKR 17,000/mt ($61/mt) compared to the previous offers. The sharp increase in the value of the Pakistani rupee against the US dollar is one of the main reasons for the revision of prices. However, the dollar-based prices have lost around $29-30/mt over the period under review.

By the end of the second week of October, the value of the Pakistani rupee has risen to around 280.59 to the US dollar, from 289.99 in the first week of October.

Meanwhile, according to sources, trade activity in the import HRC market in Pakistan has been extremely slow. Offers for ex-China SS400 HRC were reported in Pakistan at $540/mt CFR last week, down by $15/mt week on week, with several small deals for around 2,000 mt in total have been signed at the abovementioned level this week. Besides, offers for ex-China SAE1006 HRC have lost around $10/mt week on week to $560-570/mt CFR for November shipment. Meanwhile, indicative offers for ex-Japan and ex-Taiwan SAE1006 HRC have been estimated at $570-580/mt CFR, versus $585-590/mt CFR two weeks ago.

All prices on Pakistani rupee basis include 18 percent VAT.

$1 = PKR 280.59