Indian HRC (SAE 1006) export index remains unchanged this week in recent deals concluded to Vietnam for early April shipments. SteelMint’s index of HRC (SAE 1006) stands at $717/t FoB East coast. Indian mills are actively offering HRC export offers to Vietnam post-Tet holidays. Current offers for HRC (SAE 1006) stand at $740-750/t CFR Vietnam for end April shipments. However, no active offers were heard for the UAE market so far this week.
Confirmed deal-
A major private steel mill has concluded an HRC deal of about 20,000 t at $735-740/t CFR basis for end Mar-Apr shipments, SteelMint learned from its authentic trade channels.
Rationale:
Four indicative prices were considered as T2 inputs and one confirmed trade deal is considered as T1 with an average price of $717/t. The final price was an average of T1 and T2 inputs. The CFR prices were converted to FoB equivalent by deducting freight costs from the buyer/seller.
Global HRC market overview-
1.Chinese HRC export offers continue to remain on the higher side- Chinese steel mills are offering HRC at around $690-720/t FoB and remained range-bound w-o-w. However, mills are likely to increase export offers amid uncertainty on export rebate cuts. Also, an increase in freight rates is impacting the profit margins of steel mills and traders. These reasons will propel Chinese mills to raise HRC offers in the near term.
2. CIS origin HRC rise further on supply concerns- CIS origin steel mills have increased their HRC offers by about $10-20/t due to an anticipated tightening of supplies for Apr ‘21 delivery materials. The current offers stand at around $725-735/t FoB Black Sea which was about $705-725/t FoB a week ago.
Two major Russian mills namely Novolipietsk Steel (NLMK) and Severstal have planned a two-week maintenance run at their flat-rolling mills in Apr ’21. This may result in tight supply in the near term.
3. Vietnam’s Formosa to raise HRC offers-Formosa Ha Tinh might raise offers for HRC (SAE 1006, skin-pass) by about $20-25/t for Mar-Apr ’21 deliveries. Meanwhile the domestic steel manufacturer Hoa Phat raised its prices for HRC to $685-690/t CIF Vietnam for April -early May shipments. This was steeply up by $30-35/t in contrast with $650-660/t CIF basis a month ago.
An increase in offers majorly from China and India has been the force behind the price hikes in the local steel market. Chinese tier-1 mills were offering around $750-760/t CFR basis and tier -2 mills were offering at $740/t CFR basis.
4. Imported HRC offers to Pakistan increase sharply from China:
Imported HRC offers to Pakistan from China witnessed a steep hike of $20-30/t. Current offers for HRC (SAE 1006 grade) stand in the range of $740-750/t CFR, SteelMint learned from reliable trade channels. At the beginning of the week offers stood at $715-720/t CFR basis. Resumption of trade activities post-Lunar New year holidays and market buzz on export rebate cuts led to a steep hike in HRC offers.
5. Emirates Steel to expand its capacity to 5 mn t with the launch of HRC products-Emirates Steel is planning to launch hot-rolled coils (HRC) in the market to meet local and regional demand for high-quality flat products, the company informed via a press release. It is currently conducting a comprehensive evaluation for the project to construct the fully-automated HRC plant in the Middle East and North Africa (MENA) region. Although the HRC plant capacity is still under finalization, the expected capacity is about 1.6 mn t. This is likely to boost the company’s steel capacity to over 5 mn t pa.
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