This week, more hot rolled coil (HRC) offers have resulted in transactions globally, with suppliers from Asia, including those from China and India, being the most active in terms of HRC sales. However, although most mills have continued to maintain their HRC offers stable at high levels, many deals have been reported with additional discounts. Apart from Asia, suppliers from Turkey have also been more active in exports this week, increasing their sales mainly to Europe, while some smaller volumes have been sold to Africa as well. As for Europe, the import segment has been mainly represented by India and Turkey this week, while domestic HRC prices have stabilized this week, though with some upward bias as most mills have remained positive in terms of the future price trend.
More HRC export trade activity has been reported from China during past weeks as the buying interest of many customers globally has intensified. At the same time, most deals have been reported at discounted prices from non-VAT traders, while offers from big Chinese mills have remained relatively stable over the past week. Export offers for boron-added SS400 from most large Chinese mills have settled at $585-600/mt FOB for March shipment, with the midpoint at $592.5/mt, down by $2.5/mt over the week. The tradable level for ex-China SS400 HRC has settled at around $560-565/mt FOB, against $565/mt FOB at the beginning of this week and down by $5/mt week on week, based on offers from smaller mills and traders. According to sources, numerous deals for ex-China materials are reported globally in Vietnam, Turkey, the UAE and Pakistan in particular, especially through non-VAT traders offering additional discounts. The decrease in workable prices has also been connected to the weakening of the Chinese currency against the US dollar, while local prices have indicated fluctuations this week. On Friday, January 19, domestic HRC prices in China have settled at RMB 4,060-4,270/mt ($570-600/mt) ex-warehouse, with the average price level RMB 5/mt ($0.7/mt) lower compared to Monday, January 15, but at the same level as last Friday, according to SteelOrbis’ data.
Indian HRC exporters have kept boosting sales globally this week. However, most fresh bookings for ex-India HRC have been reported in the main trade destinations, including the Middle East, Europe, Vietnam and Turkey, at more or less the same levels as last week and, according to several sources, even with some discounts. In particular, ex-India HRC offers prices have been submitted in the range of $605-675/mt FOB, the same as last week. However, according to sources, deal prices have been estimated at lower levels, or at least $10-20/mt lower as compared to offers, as more Indian buyers have agreed to provide discounts in new deals. According to sources, following several deals for around 100,000 mt in total signed with European customers at $690-700/mt CFR for delivery in late February-early March last week, another deal for around 15,000 mt has been reported at around $720/mt CFR Europe, which translates to around $660-665/mt FOB. Meanwhile, by the end of the week, most ex-India HRC offers have settled at around $740/mt CFR Europe through traders. Besides, following several deals for ex-India SAE1006 HRC at $635-640/mt CFR in the Middle East last week, more bookings have been reported this week at around $625-635/mt CFR. Furthermore, market insiders have reported about 50,000 mt of ex-India SAE1006 HRC sold in Vietnam at $615-620/mt CFR last week, while a rumour about another ex-India deal for around 30,000 mt signed at $610/mt CFR Vietnam at the end of last week has been circulating in the market.
In Vietnam, import trade activity has been livelier in the SAE1006 HRC segment during the past two weeks, following the announcement of the significant increase in local HRC offers from Formosa Ha Tinh Steel last week. Particularly, market insiders have reported higher business activity in the import segment with a deal for around 30,000 mt of ex-China SAE1006 from a first-tier mill reported in Vietnam at $618/mt CFR for end-of-February shipment last week, followed by more deals for smaller tonnages at $610/mt CFR and $613/mt CFR, respectively. Meanwhile, buyers’ price ideas for ex-China position cargoes are still estimated at around $590-600/mt CFR. Apart from deals for Chinese HRC, Vietnamese buyers managed to secure deals for ex-India SAE1006 HRC last week, with around 50,000 mt in total reported to have been booked at $615-620/mt CFR, while another batch for around 30,000 mt of ex-India materials was reportedly sold at $610/mt CFR at the end of last week. Meanwhile, several deals for ex-China Q235/195 have been reported in Vietnam at $562-563/mt CFR, with offers standing at $565/mt CFR, down by $5/mt on the higher end of the range week on week. The SteelOrbis reference price for imported SAE1006 HRC has settled at $600-605/mt CFR.
The new week did not bring any significant change to the Turkish HRC market since domestic activity has remained moderate, while export activity has increased somewhat. In addition, the import segment is still mainly represented by China and, although there have been new deals for this origin, the pressure from imports has been tolerable. As a result, Turkish mills have not been in a position to provide discounts this week and have kept domestic HRC offers at $700-720/mt ex-works, mainly for March deliveries, with some medium lots sold within this range and slightly below. As regards exports, prices are in the range of $680-710/mt FOB and one of the mills, according to sources, has traded a total of 20,000 mt of HRC to Spain and Greece, while another has managed to sell at up to $700-710/mt FOB to the southern region of the EU, but also to Albania, Ukraine, Morocco and Libya, for a total of 30,000-40,000 mt. The lots are for shipments at the end of February and in March. Some sources assume that the EU buyers have shown particular interest in ex-Turkey HRC due to the risks connected with the situation in the Red Sea. In the import segment, around 40,000 mt of Q195 grade HRC of 3 mm and higher have lately been booked from China at $600/mt CFR. The same levels are still available in the most recent offers, while some market players already report offers at $590-595/mt CFR voiced by a couple of traders. Aside from China, there are indications from India at $650-660/mt CFR, which is not yet workable in the Turkish market.
In the UAE, though a considerable number of purchases have been reported from Emirati buyers, market reports specifically state that demand in the domestic market is still unsatisfactory. Despite this, trading activity in the GCC has remained active and has primarily favored Chinese and Indian materials. In consequence, GCC purchasers purchased around 45,000 mt of SAE1006 HRC from China for $600-605/mt CFR through non-VAT traders, while another batch of SS400/Q195 HRC was sold from China to the UAE at around $590/mt CFR. Meanwhile, current offers for SAE1006 HRC have dropped by $10-20/mt to $620/mt CFR or less, whereas offers for SS400 are stable at $600-620/mt CFR, for February shipment. India, on the other hand, has offered and sold this week at $625-635/mt CFR, with Indian mills hoping to increase offers to $635-640/mt CFR. Furthermore, India has sold around 20,000 mt to different GCC destinations at $630/mt CFR, with another sale to the UAE reported for nearly the same tonnage at $630/mt CFR, both for shipment in late January. On the other hand, South Korean suppliers have not made any fresh offers and have instead stayed quiet, concentrating on local or other markets where they may achieve more success.
In Europe, domestic HRC prices have stabilized this week though with some upward bias as most mills have remained positive in terms of the future price trend, emphasizing their good order books even though end-user demand has remained rather moderate. Specifically, while mills in northern Europe have continued to voice their target price for HRC at €800/mt ex-works, buyers in the region have estimated the tradable levels at around €740-750/mt ex-works, the same as last week. Offers from mills in Italy have been heard at around €745-755/mt ex-works, against €750/mt ex-works last week, while the workable price level has been assessed at €735/mt ex-works on average this week. In the import segment, trade activity has remained limited due to concerns over the quota situation, with fresh deals mainly reported for ex-India and ex-Turkey HRC. More specifically, following numerous deals for around 100,000 mt in total for ex-India HRC signed at around $700 CFR (€645/mt) on average mainly to southern Europe last week, this week more deals through traders have been reported in the region at €660/mt CFR, while offers have increased to around €680/mt CFR. Meanwhile, market insiders have been actively discussing ex-Turkey deals this week, with at least 50,000-60,000 mt in total reported to have been booked at around €690-695/mt CFR duty paid. At the same time, most ex-Turkey HRC offers have been estimated by Italian customers at around €710-730/mt CFR duty paid, up by €20-40/mt week on week.