- HRC export index rises to $583/t FOB
- Bid-offer disparity in key importing nations
- Demand-supply mismatches emerge on the global platform
- Chinese HRC offers up after market resumes after holiday
SteelMint’s India HRC (SAE1006, boron-added) export index bounced back by $8/tonne (t) this week to $583/t FOB east coast. Last week, the index had dropped by $8/t to $575/t FOB.
Indian mills have started indicating higher offers for the Vietnamese market this week, while offers to UAE remain unchanged.
As reported last week, a few Indian mills are keeping their focus on the better realisation fetching domestic market.
Rationale: Seventeen indicative prices were considered as T2 inputs, while there were no deals to be reported as T1 under the rationale. The final price was an average of T1 and T2 inputs which stood at $583/t FOB. The CFR prices were converted to FOB equivalent by deducting freight costs from the buyer/seller.
Market-wise highlights
1. Indications for Vietnam increase, market awaits FHS’s announcement: Indian steel majors have started indicating prices around $630/t CFR levels, up by $20/t from previous week’s $610/t CFR. Meanwhile, a few mills stay withdrawn from the market.
Chinese HRC (SAE1006) was heard at $610/t CFR, unchanged over the week.
Vietnamese market participants are keenly awaiting November and early-December price announcement from Formosa Ha Tinh (FHS) and Hoa Phat. Also, Japanese and South Korean mills stay withdrawn from the global market amid the disruption caused by typhoon Hinnamnor in the latter.
2. Bid-offer disparity in UAE: Indian steel majors continue indicating $630-640/t CFR levels for the UAE market. While the Chinese continues to offer at $620-630/t CFR. However, the UAE market also remains muted because of the bid-offer disparity. “Bids received are lower by $10-15/t from the levels of current offer levels,” informed a reliable UAE-based source.
3. Energy prices surge in Europe, Turkey: The absence of counter bids has kept HRC export indications for the European markets at $690-700/t CFR Antwerp. The market is having high inventories from previous procurements, whereas, down-stream industrial demand remains weak. Surging power costs in EU and the Turkish markets have led to curtailed production which may result in improved inquiries for imported HRC, informed reliable sources.
Also, indications for Indian origin boron added HRC to Turkiye stands around $650-660/t CFR, up by $20-30/t from the previous week levels.
4. Holiday mood keeps Nepal market inactive: Nepal’s imported HRC market has remained slow amid festivities. Indian mills were heard offering HRCs in range of INR 52,000-52,500/t ($657-663/t) CFR Raxaul border. Last week, indication was around INR 52,500/t ($657/t). Since, Indian mills are offering in INR terms, conversion to USD ($) shall vary as per the conversion rate.
Outlook: The global HRC market seems to be supportive as the market opened today after Chinese holidays. Chinese steel major- Baosteel has kept the October sales prices of its flat steel products unchanged. The company intends to let the market stablise as domestic demand is recovering at a slower pace. Also, Chinese futures have increased by RMB 106/t w-o-w. Today’s Chinese HRC SHFE (January 2023 contract) closed at RMB 3,860/t, while it was around RMB 3,754/t as on 6 September.
Following hike in domestic HRC prices and futures, export offers have also witnessed hike of around $15 w-o-w. Chinese HRC (SS400) export offer stands at around $595/t FOB. A deal involving 100,000 t HRC was heard booked by South Korean buyers from China. The devastation caused by typhoon Hinnamore has kept the domestic market supplies tight, thus opening gates for imports. It might take some time for POSCO to start its hot strip mill (HSM) at the Pohang factory, after it was partially submerged due to the flooding.
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