Indian CRC export offers to EU remain flat w-o-w amid slow market sentiments
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Indian CRC export offers to Europe (EU) remained stable w-o-w at $740-745/t CFR Antwerp ($690-700/t FOB east coast India). No deals were heard concluded, as buyers adopted a wait-and-watch mode. Subdued demand in the region along with lack of clarity in EU import quotas kept Indian CRC export offers stable.
Factors driving CRC export prices
Low domestic steel demand in EU: Domestic steel demand in the EU is still slow. Steel end-user industries' trading activities are slow compared to last year, which is affecting overall sales. Several market analysts believe production cuts and blast furnace stoppages can stabilize prices. However, steel mills argue that current steel prices are already at their minimum profitable level, and lowering them further would not stimulate the market.
Indian HRC export offers to EU drop w-o-w: Indian HRC export prices to Europe (S275, 3mm) fell by around $5/t this week to $640-645/t CFR Antwerp ($590-595/t FOB east coast India). This drop comes amid cautiousness from European buyers due to weak demand and uncertainty surrounding import quotas. Buyers are looking for even lower prices, but sellers are hesitant after China's reopening on Monday. Additionally, slow trade activity in the EU market has mills resisting further price cuts due to production cost pressures.
Global CRC export offers: Chinese CRC export offers remained stable w-o-w at $615/t FOB this week, despite the fall in SHFE futures.
China's SHFE futures on d-o-d basis remained range-bound at RMB 3,750/t ($518/t) on 10 April 2024, against RMB 3,749/t ($518/t) a day ago. However, the same declined by RMB 58/t ($8/t) against RMB 3,692/t ($510/t) a week ago.
Outlook: Europe is facing the toughest steel market conditions globally. The region is struggling with high inflation, rising interest rates, and ongoing energy price hikes. These factors caused a significant decline in steel demand. However, demand is expected to improve this year -- a more substantial recovery is anticipated in 2025, with steel demand projected to rise by 5.3% y-o-y. Despite this growth, EU steel demand in 2024 is still predicted to be only marginally higher than the pandemic-low touched in 2020.