Ex-India hot rolled coil (HRC) prices have mainly been kept unchanged by local mills who have continued to hold back deals given that bid volumes have been too low, coupled with expectations of a price rebound and the mills’ greater focus on better margins from local sales. Besides, another important reason reason for mills keeping their offers stable is that most Indian producers have planned shutdowns for annual maintenance works from early April.
Sources said that ex-India HRC prices are stable in the range of $550-585/mt FOB, though trade activity has remained extremely slow given that sellers have not been interested in new sales, while buyers have not been bidding recently. “Most offers have been kept stable. However, we heard that for serious buying inquiries on loaded vessel basis mills are targeting from $565/mt FOB to $600/mt FOB, depending on the destination,” an Indian trader told SteelOrbis.
At the same time, the trend emerging over the past few weeks showed that buyers from Europe and the Middle East are showing preference for small tonnages but in more frequent deals to minimize the risks from fluctuating prices and the uncertainties of delivery in view of geo-political uncertainties impacting shipments in the Gulf region. According to sources, last week an eastern India-based mill reported a trade for 4,000 mt for delivery to Antwerp at $635/mt CFR. However, most ex-India HRC offers are already voiced at $640-645/mt CFR.
Furthermore, according to market insiders, considering planned shutdowns at mills for annual maintenance, the overall production volume for the April-June quarter is estimated at less than one million mt. “Most large domestic mills have not firmed up any export allocations for the current quarter. Domestic sales are the focus based on comparative margin assessments. Moreover, the domestic market will face supply tightness in May and June, with some mills going into maintenance shutdowns and producers need to keep inventories ready to meet local demand during this period,” a source at Tata Steel told SteelOrbis.
“Global prices are firming up but not at a pace to make exports attractive for Indian mills. Mills in the EU region are attempting to push up prices. But they will need to consolidate at the higher levels for Europe-based distributors to get interested in imports. Right now, buyers from the region are only interested in very small tonnages as they are risk-averse,” another source said.