Posted on 13 Apr 2022
The Gulf Cooperation Council hot rolled coil market has received long-awaited Indian price offers, but Chinese mills are still more competitive following their price decline. A further price decrease is anticipated, Kallanish understands.
This week, a pipemaker in Oman has concluded a deal, splitting the ordered quantity between a Chinese mill – larger portion – and an Indian mill – the smaller portion – for 1.8-6.55mm thickness S275JR grade HRC at $970/tonne and $1,000/t respectively cfr Sohar. The shipment is scheduled for June. A similar enquiry was awarded to a Chinese mill at $994/t cfr Sohar at the beginning of April.
In United Arab Emirates, a buyer has booked 2,500t of 0.34-1.5mm thickness SPCC/1B grade ex-China cold rolled full hard (CRFH) at $975/t cfr UAE, for May shipment.
In the UAE and Saudi Arabia markets, on a cfr basis, re-rolling grade [SAE 1006] 2mm+ HRC offers from Chinese mills are heard at $960-980/t. This is down $15-35/t on the last round of deals concluded at $990-995/t cfr two weeks ago.
In UAE, the largest re-roller has floated an enquiry for 25,000t of re-rolling grade HRC for June shipment. The enquiry is expected to conclude a deal by Thursday.
Japan’s largest HRC producer has been receiving enquiries for June shipment and is expected to quote 2mm+ SAE 1006 grade HRC at $1,100-1,120/t cfr GCC, with $50-80/t being negotiable for firm bids.
"The market is extremely quiet and offers for the largest-tonnage enquiry [25,000t] will give a fair sense of understanding of HRC prices,” comments a regional sector participant. “If Indian mills will offer, this will be interpreted as them having appetite for the GCC market. European market buying sentiment is slow and Indian mills are undeniably losing the GCC market since they have not been offering.”
In Saudi Arabia, a Chinese mill is heard adding a new condition in sales agreements. If China implements an export duty before shipment of the product, the buyer will cover the cost. This is causing hesitation among buyers, however. The Chinese mill's 1.2mm SPHC grade –equivalent to JIS G3131 – HRC offers are heard at $1,040-1,050/t cfr Dammam for June shipment.
"I don't think China will impose an export tax on finished steel since the domestic market is subdued in China. The country may impose export taxes on semi-finished material such as billets or slabs, but nothing is clear," opines a steel sector analyst.
Source:Kallanish
