Indian HRC export market witnessed a fall by around $36/t following a decline in Chinese export offers. Currently, Indian steel mills are offering majorly to UAE and Europe on higher realizations vis-a-vis Vietnam.
Currently, SteelMint HRC (SAE 1006) index stands at a $749/t FoB basis which was at $785/t FoB basis last week.
“Realisation in Europe so far was much better but if no more sales would be seen in Europe due to quota issue then it will be interesting to see if they will reduce the price for Vietnam”, shared an export trader to SteelMint
Indian mills have lowered their HRC export offers for Europe by $10 to $830-840/t CFR Antwerp. However, importers are bidding around $815-820/t CFR basis.
Rationale: Four indicative prices were considered as T2 inputs, with an average price of $749/t. The final price was an average of T2 inputs due to the absence of confirmed trades (T1). The CFR prices were converted to FoB equivalent by deducting freight costs from the buyer/seller.
Global HRC market overview-
1. Chinese HRC export offer continues to fall on the month
Chinese mills continued to reduce their export offers for the second consecutive week. The current week’s offers are assessed at $620-630/t FoB China, declining from $640-650/t FoB a week back. Lower buying interest in both domestic and overseas markets due to volatile futures in the past few weeks kept the market sentiments bearish. Fewer importers were bidding during the week in anticipation of further decline in offers before the Lunar New Year Holidays beginning from 11th Feb.
2.CIS origin HRC export offers decline by $20 w-o-w-
The HRC producers in the CIS region cut their offers to $745-760/t FoB Black Sea against the previous week’s $765-780/t FoB basis. Buyers are awaiting clarity on the price direction which has weighed down on the export offers this week.
3.Vietnamese buyers turn cautious ahead of Tet holidays-
Buyers in Vietnam have kept a watchful approach on import bookings in anticipation of domestic mills rolling out prices in late Jan ’21 for April deliveries. Chinese mills had to reduce HRC export offers to $670/t CFR Vietnam due to the scant buying interest among buyers and the need to destock ahead of the Lunar New Year.
4.Imported HRC offers to Pakistan- Chinese traders are offering HRC (SS400B) position cargoes at around $630/t CFR basis for Feb shipment. Also Taiwan steel mill booked HRC (SAE 1006) cargo at $760/t CFR basis for April shipments,SteelMint learned from it trade channels. However quantity couldn’t confirmed while publishing this report
Outlook- Chinese HRC export offers are expected to soften further on volatile futures. Thus following the market trend offers from other major exporting nations may decline in near term
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