Posted on 12 May 2022
Deteriorating global and domestic market sentiment has forced Indian mills to decrease hot rolled coil quotes further, but this has still not spurred counter-bids from buyers.
Bids from European and Turkish buyers are nowhere close to matching Indian offers, owing to which buyers are heard withdrawing from negotiations well before deal conclusion, sources inform Kallanish.
To counter the sluggish demand amid high competition, Indian mills have dropped their initial offers to all destinations. Initial quotes to Europe plunged to $1,000-1,030/tonne cfr southern and northern Europe, equating to $910-920/t fob India. Buyers’ expectations however stand at below $940/t cfr Europe, with further price decline anticipated. No deal has been heard concluded this week from India to Europe.
“Sliding prices have panicked buyers and no one wants to take a risk at the moment,” opines a senior trader. “Offers are dropping and so are bids; bids today become the [mills’] quotes seven days later.”
Indian HRC export offers to Turkey have plunged to $920-930/t cfr Turkey, against buyers’ expectations of below $900/t cfr. Likewise, offers to the Gulf Cooperation Council plummeted to $910-915/t cfr GCC. A deal for a small quantity was heard concluding at $910-920/t cfr UAE towards the end of last week. Major buyers in United Arab Emirates are expecting Indian mills to drop their offers further to $880-900/t cfr UAE.
Amid the sluggish demand in the West, Indian mills are reportedly knocking on Vietnam’s door by offering SAE 1006 HRC at $850-860/t cfr Ho Chi Minh City. However, the offers have not translated into deals as buyers’ expectations are noted down below $800/t cfr HCMC, and Vietnam is waiting for domestic mills to float their quotes.
Indian E250 grade HRC domestic quotes slipped to INR 71,000-71,500/t ($918) ex-Mumbai. Offers for E350 and galvanized plain sheet however hiked to INR 73,000-73,500/t and INR 84,000-84,500/t ex-Mumbai, respectively.
The influx into China of Russian coking coal, billet and slab has adversely impacted Indian steel mills. India is dependent on raw materials imports and any fluctuation in their prices directly hits finished steel in the nation. Hence, despite its 120 million tonnes/year of crude steel production, India cannot compete with sanctioned yet cheaper Russian raw materials and semis.
Source:Kallanish
