The global hot rolled coil (HRC) market has started to witness cautious signs of optimism this week, driven mainly by the recovery of Chinese HRC futures prices, which has resulted in more increases in new offer prices and deal prices, not only from Chinese suppliers, but also from a number of other Asian suppliers. At the same time, although Indian HRC exporters have kept their prices mainly stable this week, the mood among them has improved to some extent, with some offers for ex-India HRC heard at higher levels in Europe by the end of the week. As for Europe, despite another drop in local HRC prices, most market insiders believe the bottom has finally been reached, while import prices have started to show signs of recovery.
In China, although most HRC mills have continued to maintain their offers at unchanged levels this week, several producers as well as Chinese traders have decided to go a bit higher as increased local and futures prices for HRC have been providing support for the market mood. Specifically, export offers for boron-added SS400 HRC from large Chinese mills have settled at $530-550/mt FOB, with a midpoint at $540/mt FOB, up by $7.5/mt week on week. However, according to sources, only a few producers have decided to go higher this week, while most have maintained their offers unchanged at $530-540/mt FOB, the same as last week. The tradable levels for ex-China SS400 HRC have been estimated at $530-535/mt FOB by the end of the week, against $520-530/mt FOB at the beginning of the week and up by $5-15/mt week on week.
Prices in the import HRC market in Vietnam have posted another increase this week. At the same time, according to sources, most import prices which have moved up have been from Chinese suppliers, and mainly for pipe-making coils, given the higher demand for these materials as compared to re-rolling grade SAE1006 HRC. More specifically, by Thursday, April 18, the prices for ex-China Q235 and SS400 HRC have settled at $540/mt CFR, up by $10/mt since Monday, April 15, and against $535-530/mt CFR last week. Meanwhile, offers for ex-China Q195 HRC have been voiced at around $530/mt CFR, up by $10/mt week on week. In the meantime, offers for ex-China SAE1006 HRC are rare in Vietnam, with the indicative prices heard at $555-565/mt CFR, depending on the supplier, against $560/mt CFR last week. Furthermore, talk about deals for ex-India HRC has been circulating in the Vietnamese market this week. In particular, according to sources, several deals for around 30,000 mt in total for ex-India HRC have been signed at around $565/mt CFR this week, though no official confirmation has been provided by the time of publication. Meanwhile, indicative offers for ex-India HRC have been heard at $570/mt CFR and above. The SteelOrbis reference price for import SAE1006 HRC has been assessed at $555-565/mt CFR, versus $560/mt CFR last week.
Although ex-India HRC prices have mainly been kept unchanged by large mills this week following slack trade activity, some Indian sellers have become more positive this week, given the improved sentiments in China coupled with the expected revival of demand in destinations such as the Middle East and southern Europe. Ex-India HRC prices have been estimated at $545-570/mt FOB, mainly the same as last week, with the lower end of the range corresponding to offers in Asia and some non-traditional markets, like Nepal and Bangladesh. At the same time, while most ex-India HRC offers have been maintained at around $635/mt CFR Spain, the same as last week, offers from a number of traders have increased slightly to $645/mt CFR, including 90-day deferred payment.
In Europe, despite another decrease in local prices for HRC by around €10-20/mt week on week, by the end of the week most producers have reported a price stabilization given that most of them are squeezed by their costs. Specifically, while offers from Italian mills have dropped once again, by around €10-20/mt over the past week, to €630/mt ex-works for mainly May delivery, tradable prices have been estimated at €610-620/mt ex-works, against €630-640/mt ex-works last week. Furthermore, offers from HRC producers in the north have been estimated at €630-640/mt ex-works for May-June deliveries, down by €20/mt week on week, while workable prices have settled at €620-630/mt ex-works, according to sources. At the same time, most import prices have stabilized as well, with some offers even showing an upward bias, while trade activity has remained slow given the limited demand from all main steel users. In particular, most ex-Asia HRC offers have been heard at €580-610/mt CFR, against €560-600/mt CFR last week. According to sources, business activity has remained limited, with only a few deals heard for ex-Japan HRC at €590/mt CFR southern Europe.
In Turkey, the HRC market has been fluctuating this week. Domestic mills returned from the holiday in a slightly bullish mood, but then returned to the previous price levels. Early this week, domestic HRC offers in Turkey were announced at $630-645/mt ex-works and above, up $10/mt on the lower end of the range. However, subsequently, the level of $620/mt ex-works has been seen again in the market and, according to sources, one of the suppliers has been giving $610/mt ex-works for certain customers. In the import segment, the initial HRC offers in the current week were at $550-560/mt CFR, but later were increased to $570/mt CFR for Q195 material. In addition, according to some sources, a cargo of SAE1006 HRC has been booked this week at up to $575/mt CFR, which makes around $560/mt CFR base.
In the UAE, since local demand has remained insufficient, trading activity has remained quiet. Meanwhile, despite Emirati purchasers' lower expectations, HRC import offer remain largely stable. While some Chinese traders are offering to the UAE at about $570/mt CFR, the majority of SS400 offers this week from China have remained stable at around $550–555/mt CFR for May shipments. Similarly, ex-India prices are also stable, with offers at $600-610/mt CFR for May and June shipments. However, this week South Korean suppliers made the same decision as Japanese suppliers and withdrew offers to the UAE, with the latest offer being at $640/mt CFR for May shipment.