Indian CRC export offers to EU drop w-o-w amid falling global prices

• Indian CRC export volumes fall m-o-m in Feb'24
  
  
• Chinese CRC export prices drop by $10/t
  
  

Indian CRC export offers to Europe (EU) fell by $20-25/t w-o-w to $750-755/t CFR ($700-710/t FOB east-coast India). Following the decline, a deal of around 6,000-7,000 tonnes (t) was heard concluded at similar price levels.

Factors affecting export prices

Low domestic demand of steel in Europe: The European steel market is sluggish due to weak demand. Anticipating lower prices, buyers are holding off on purchases, leading to thin trading and limited bookings. This weakness extends to imports as well.

Global CRC exports fall w-o-w: Chinese CRC export offers declined by $10/t w-o-w to $625/t FOB this week against $635/t FOB previous week, following the decline in SHFE (Shanghai Futures Exchange) HRC futures in the previous week.

Chinese SHFE HRC futures fell by RMB 99/t ($14/t) w-o-w to RMB 3,699 ($514/t) on 15 March 2024 against RMB 3,798 ($528/t) on 11 March 2024. However, the same increased by RMB 117/t ($16/t) to RMB 3,795/t ($527/t) on 20 March 2024 as compared to RMB 3,678/t ($511/t) on 18 March 2024.

Weak Chinese auto-sales in Feb'24: China's auto sales and production experienced a significant decline in February 2024. As per CAAM (China Association of Automobile Manufacturers), production declined by 37.5% m-o-m and 25.9% y-o-y to 1.506 million units as compared to the same time period last year. Moreover, sales fell by 35.1% m-o-m from January and 19.9% y-o-y, reaching 1.584 million units. With the Chinese New Year holiday spanning 10-17 February, and many car manufacturers have suspended operations due to the holiday break resulting in lower production and sales volumes.

Outlook: India's CRC export volumes for February 2024 declined by 24% m-o-m to 46,851 t compared to 61,487 t in January 2024. Considering the global outlook, Indian CRC export volumes are expected to see a further decline in March 2024.