SteelMint’s India HRC (SAE1006) export index dropped further by $3/tonne (t) to $722/t FOB east coast as the market awaits returning of the participants after the New Year holidays. However, lowering bids and slow buying in both the overseas and domestic markets have pushed Indian steel giants to reduce offers in the past few weeks.
Rationale: Twelve indicative prices were considered as T2 inputs, while no export deals were reported as T1. The final price was an average of T1 and T2 inputs which stood at $722/t FOB. The CFR prices were converted to FOB equivalent by deducting freight costs from the buyer/seller.
Factors weighing on Indian export offers:
Bid-offer disparity in Vietnam market:
There is a disparity in bids from Vietnamese buyers and offers from the Indian mills. Moreover, increasing Covid cases are keeping the trade momentum slow.
Current week offers and bids:
- Indications from Indian mills are heard at around $750/t CFR, down $10/t, w-o-w.
- Russian mills are offering at $750/t CFR, down $10/t, w-o-w.
- Chinese offers stand unchanged at $795/t CFR.
- Japanese mills reduced offers by $10/t w-o-w to $815/t CFR.
- Bids from Vietnam continue to be at around $740/t CFR for the past couple of weeks.
Fall in prices indications of Middle East, Turkey
In the Middle East region, last heard offers for the UAE market were at $765/t CFR.
However, few indications were heard at $775/t CFR Turkey this week, lower by $10/t on the back of the New Year holidays.
Outlook: Indian mills are most likely to consider rolling out fresh export offers in the next couple of days post the announcement of domestic offers for Jan’22 deliveries. In addition, the market awaits the comeback of EU buyers which would give further clarity on Indian export prices. As per SteelMint, India’s steel export volumes are estimated to rise by around 16% to almost 20 million tonnes (mn t) in CY’21 compared to 17.50 mn t in CY’20.
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