- Government announces export tax on finished steel exports
- Indian mills withdraw offers from overseas markets
Indian steel majors have withdrawn from the overseas markets this week after the government announced a 15% export tax on finished steel products, including hot rolled coils (HRC). The announcement was made late last Saturday, 21 May, 2022.
Global market updates
- Vietnam’s domestic mills steeply reduce HRC offers for July, early Aug: Hoa Phat announced a steep reduction of $130/t in its offers, which now stand at $793/t CIF HCMC. Offers from China for HRCs (SAE1006) are being heard at around $765-790/t CFR Vietnam this week.
- UAE market slows down: The imported HRC market in the UAE also slowed down with Indian mills withdrawing their offers. On the other hand, offers for Chinese HRCs (SAE1006) were heard hovering around $880/t CFR, unchanged against the previous week’s quotes. “The market is perplexed. Chinese mills are seeing this as an opportunity to increase prices, but there is no demand to support it,” informed a reliable UAE-based source.
However, earlier in the previous week, a private Indian steel major had concluded an export deal for 6,000-7,000 t of HRCs to the UAE at around $860-870/t for end-June shipment.
Currently, mills are trying to understand the implications of the export duty on the previously-concluded deals, which are yet to be dispatched/honoured. “Mills are trying to figure out what will happen to the export deals already executed or deals for which LCs have been opened,” informed a reliable industry participant.
- Slow buying in EU: HRC buyers across Europe preferred to hold back from making deals because they felt the market bottom is yet to be reached.
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