- Middle East demand firm amid construction boom
- Indian offers to EU flat amid summer holiday lull
BigMint’s India hot-rolled coil (HRC, S275 for Europe) export index remained flat w-o-w at $555/t (FOB main port) amid low trade activities in the region following weak demand as market participants continue to stay away due to the summer holidays.
India’s HRC (SAE1006 for Middle East) export index remained unchanged w-o-w at $505/t FOB main port. However, demand in the Middle East (ME) continued to remain firm driven by ongoing construction projects. Additionally, a BigMint source said, “Construction demand remains strong, with Chinese prices fuelling intense competition across long and flat steel products, from upstream to downstream.” Notably, a deal has been heard concluded for October, signalling sustained demand.
1. Indian HRC export offers to EU stable: Indian HRC export offers to the EU held steady at $605-610/t CFR Antwerp ($555-560/t FOB India). Trading remained as market participants are in a holiday mood leading to weak downstream demand, particularly from automotive. Furthermore, the European HRC market stayed sluggish in late August, with trading activity muted due to ongoing holiday absences. Domestic suppliers are attempting to hike prices, but buyers are resisting the offers.
2. Chinese HRC prices to Middle East unchanged: Chinese HRC export offers to the Middle East remained unchanged for the week at $515/t CFR UAE.
Indian HRC export offers to the ME are ranging between $525-535/t CFR UAE, with a recent deal concluded at similar levels for around 25,000 t for September shipment to a UAE-based tube-maker and re-roller.
HRC futures on the Shanghai Futures Exchange (SHFE) dropped by RMB 43/t ($6/t) w-o-w to RMB 3,380/t ($472/t) as compared to RMB 3,423/t ($478/t) a week ago. Moreover, on a d-o-d basis, contracts inched down by RMB 11/t ($2/t).
Outlook
Indian HRC export offers are likely to face competitive pressure in the Middle East, while European demand, currently muted due to summer holidays and regulatory uncertainty, may revive as integrated mills push for price hikes, potentially sparking buyer interest. However, near-term demand in Europe is expected to remain sluggish, with a seasonal recovery likely only after the summer period.
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