Posted on 31 Mar 2022
The arrival of Chinese hot rolled coil in Europe has impacted Indian HRC export offers in the region. Low domestic demand for HRC in India coupled with low buying interest for Indian HRC in Europe has further pressured Indian mills to drop their offers in Europe, various sources inform Kallanish.
Despite paying duties, Chinese offers were heard at lower than Indian offers in Europe. China has recently booked HRC at $1,300-1,320/tonne cfr Antwerp (duty paid), which has reduced the price expectations of buyers in Europe. Buyers are now aiming to secure HRC tonnages at lower prices, or else aim to roll HRC by importing slab from China, Indonesia and India.
Even after the recent surge in fuel and freight prices, Indian mills are now aiming to book big HRC tonnages at comparatively low prices.
Initial Indian offers for bulk quantities to Europe this week are noted at $1,250-1,280/t cfr Europe, whereas for small quantities mills are indicating $1,320-1,350/t cfr Europe.
A deal for structural grade HRC in bulk quantity – 20,000-25,000 tonnes – was heard at $1,230-1,240/t cfr Italy last Friday. Another deal for 12,000-15,000t of special grade S355 HRC was heard concluded on Friday at $1,400/t cfr UK. An Indian mill is reported to have sold a small quantity of S275 grade HRC at $1,365/t cfr Antwerp for May shipment.
“Mills in Italy are now looking to import slab instead of HRC, owing to which Indian offers have come down dramatically,” says a senior trader.
“China has reportedly started offering HRC in Europe; their duty paid offers are much lower than Indian offers,” opines another source.
In the Gulf Cooperation Council, two different Indian mills offered re-rollable grade (SAE 1006) HRC this week at $1,130/t cfr and $1,150/t cfr respectively for May shipment; however, no deals were confirmed.
Despite low demand in the domestic market, retail offers for E250 grade HRC have surged to INR 76,500-77,000/t ($1,015) ex-Mumbai. Offers for E350 and galvanized plain sheet are pegged at INR 79,500-80,000/t ex-Mumbai and INR 85,500-86,000/t ex-Mumbai, respectively.
“Owing to the end of the fiscal year, the market has been silent. Higher prices have led to buyers purchasing 70-80% of their actual requirements and, in the long run, these high offers are not going to sustain,” says a domestic HRC trader.
Export offers from India are expected to plunge further in the coming weeks mainly because of the downward trend in the domestic market. Moreover, recent coking coal bookings from Russia are expected to ease production costs, ultimately helping mills to negotiate and compete with their competition to some extent.
Source:Kallanish
