Indian mills have actively resumed interest in HRC export with nearly three confirmed trades being concluded towards the end of last week mainly to Turkey and Vietnam. SteelMint’s Indian HRC (SAE 1006) export index stands at $882/tonne (t) FoB east-coast basis, down by $30/t w-o-w against $912/t FoB w-o-w.
Recent deals concluded
- A private mill concluded a 30,000 tonne (t) deal to Vietnam, at $915/t CFR, or equivalent to $875-880/t FoB India.
- In another deal, two parcels of around 50,000 t were booked to Turkey below $950/t CFR levels.
- Another private mill based in eastern India booked around 20,000T HRC to Vietnam at $915/t CFR but this could not be confirmed till the time of publishing this report.
- All bookings are for Aug’21 shipments.
Mills are planning to book further quantities mainly to Vietnam, UAE, and Turkey for Aug shipments. At present, mills have higher allocations for exports due to dull demand prevailing in the domestic market.
Global HRC market overview
a) China’s HRC export offers rebound- The Chinese steel mills have steeply increased their export offers by about $10-30/t w-o-w. The current week’s assessed offers stand at around $930-950/t FoB China contrasted against $920-940/t FoB a week ago.
This came on the back of an announcement by the People’s Bank of China to cut the Reserve Requirement Ratio (RRR) rate by about 0.5 percentage points towards the end of the previous week. This will lead to an influx of about RMB 1 trillion into the economy and improve liquidity in the market, benefiting the manufacturing sector.
Also, one of China’s major steel producers, Baosteel, has rolled over its prices for most of its steel products for Aug’21 shipments.
However, demand continued to remain sluggish owing to the monsoon’s seasonal lull.
b) CIS-origin HRC export offers move down further- CIS-origin HRC export offers have further slipped by $15-20/t w-o-w. An increase in competition from the Asian countries in CIS’s traditional markets has continued to weigh on the offers from major steel producers.
The current week’s assessed offers stand at around $920-940/t FoB Black Sea as compared to $945-955/t FoB basis a week back.
c) Vietnamese importers await price announcement from domestic player- Vietnam’s imported HRC prices witnessed correction in a deal reported from India last week. The Southeast Asian region faced hurdles in both demand and trading due to the resurgence of Covid-19 cases in late-Mar’21. Most of the countries in the region are under lockdown and following stringent regulations to curtail the spread of the disease which is leading to lower domestic and international trade volumes.
Current week’s offers-
- Indian mills are offering at $915-930/t CFR basis.
- Chinese mills’ offers are flat at $920-930/t CFR.
- Japanese mills are offering around $1,050/t CFR.
- Russian offers were heard around $890/t CFR
Vietnam’s major domestic integrated steelmaker, Formosa Ha Tinh, is planning to announce its offers shortly. However, it is assessing the current situation before announcing appropriate price levels, SteelMint learned from credible sources.
d) Imported HRC offers to Pakistan- The Japanese and South Korean mills have resumed offers to Pakistan this week. While Japanese mills are offering imported HRCs at $1,050/t CFR basis, the South Korean offers are heard at $1,070/t CFR.
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