The absence of active trade deals amid dull demand in the global market led to a fall of $9/tonne (t) in India’s HRC FoB index this week. SteelMint’s India HRC export index stood at $902/tonne (t) FoB east-coast basis against the previous week’s $911/t FoB India.
Factors weighing on offers
a) Vietnam is under lockdown until 4 Sept’21 on surging Covid-19 cases, demand remains dull amid restricted economic activities.
b) Exhaustion of quarterly quotas to Europe. However, recent quotes are around $1,020-1,030/t CFR, SteelMint learned from reliable sources.
c) Limited deals to Turkey and the Middle East due to dull demand.
d) Absence of clarity regarding China’s export tax announcement.
“Absence of active export bookings by Indian mills amid dampened buying interest in the overseas markets, since mid-July has weighed on the offers,” said a reliable market source.
Rationale: Nine indicative prices were considered as T2 inputs while no major export deals were reported as T1. The final price was an average of T2 inputs which stood at $902/t FoB. The CFR prices were converted to FoB equivalent by deducting freight costs from the buyer/seller.
Global HRC market overview
1. China’s HRC export offers decline over the week: The export offers for HRC (SS400) from Chinese mills have come down further by $30-50/t this week. The continued air of uncertainty around an export tax announcement has kept the demand for Chinese HRC slow amongst importers. The current week’s offers for HRCs (SS400) stand at around $970-1,000/t FoB China as against $1,000-1,020/t FoB in the previous week.
2. Imported HRC offers to Vietnam reel under Covid-19 disruptions: The slump in demand in Vietnam has led to a $20/t decline in imported HRC offers this week. Extension and tightening of lockdown norms till 4 Sept’21 have dented demand in the country. Manpower availability and logistical barriers are further adding to the woes.
Current week’s prices
i) Russian mills’ quotes are at $860/t CFR.
ii) Indian mills have no firm offers, but few indications were heard at $900-910/t CFR.
iii) Chinese major mills are offering at $970-990/t CFR.
3. Imported HRC offers to Pakistan decline from China: Chinese steel mills have reduced their offers by a steep $50/t this week. The current rolled offers stand at $940-950/t CFR Pakistan as against $990-1,000/t CFR a week ago.
On the other hand, Japanese mills’ offers continue to be higher at $1,040-1,060/t CFR while Taiwanese mills kept their offers unchanged at $1,030-1,050/t CFR.
Leave a Reply