The supply shortage of hot rolled coil (HRC) in the GCC region, caused by reduced exports from China in particular, has forced Emirati customers to accept higher prices in recent deals. According to sources, the uncertainty over possible changes in China’s export tax rebate has encouraged Chinese suppliers to take a more cautious approach in their export sales, with the result that most buyers can hardly get any firm offers from them lately. Apart from that, following the Chinese New Year holiday, Chinese suppliers are not in a hurry to export now, given the support coming from their local market. “While ex-China HRC price levels are not clear, prices in the region will be high,” a representative of a UAE-based re-rolling mill said. “Chinese HRC offers have not been heard by anyone up to now,” another buyer commented.
Amid the above circumstances and taking into account the bullish outlook for global prices in general, it has not taken long for Emirati customers to return to active negotiations with India-based HRC suppliers and, consequently, to book large volumes of material. Accordingly, SteelOrbis has learned that close to 70,000 mt of ex-India HRC was booked at $740-750/mt CFR UAE recently, up $15/mt compared to deals done two weeks ago. According to the local sources, HRC offers from the regional producer Hadeed are approximately at the same level. “Hadeed SABIC came late. Most customers have been already booked,” one market player commented.