Japanese HRC exporters are expected to announce a further sharp increase in prices after the Golden Week holidays in Japan as a shortage of supply still persists in the market and as local demand is good, SteelOrbis learned from market sources in late April.
The latest offers of ex-Japan SAE1006 HRC to Asian customers were at $1,000-1,050/mt CFR in late April before the holidays, versus $900-920/mt CFR a month ago. A more than $100/mt increase in April continued to reflect the tight availability for the export spot market, which is unlikely to ease in the coming one to two months, sources have said.
Limited volumes of ex-Japan HRC for June shipment were traded to Pakistan at $1,005-1,010/mt CFR Karachi in late April. Negotiations with Southeast Asian customers like Thailand and Indonesia were held at $1,050/mt CFR, but with no deals reported. Before the Golden Week holidays which started on April 29, all major steel mills from Japan withdrew their offers and are expected to come back next week with higher prices.
Japanese sellers were avoiding sales of HRC to Vietnam over the past month as the maximum tradable level for thin 2 mm coils to this destination reached $980/mt CFR in late April.
Some sales were reported to the European market, where prices skyrocketed to their highest levels. Deal prices for ex-Japan coils to the EU were at $1,100/mt CFR before the latest hike by ArcelorMittal late last week. At the moment, the tradable level is assessed by market sources at about $1,130/mt CFR. One Japanese supplier voiced offers at $1,160-1,170/mt CFR before the holidays.
One of the large traders from Japan said that the shortage of material in the export market has also been fueled by firm local demand. Nippon Steel has announced a domestic HRC price increase by JPY 10,000/mt or $91/mt for May.
