Indian HRC export offers on hold for third consecutive week
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- Indian mills now focused on domestic market
- Hoa Phat increases HRC prices for July shipments
- SHFE HRC futures rise w-o-w post Labour Day
Indian HRC export offers for Southeast Asia and the Middle East (ME) continued to remain on hold for yet another week. Mills are currently prioritising the domestic market, where offers have been further increased by INR 1,500/tonne (t) for May deliveries. Domestic HRCs (2.5-8mm, IS2062, Gr E-250 Br.), post the latest hike, have risen to INR 54,500-55,000/t exy-Mumbai for coil-to-coil basis excluding 18% GST.
"Chinese mills are trying to quote prices on the higher side and waiting for market reaction since there are offers from competitive origins like Japan and India," informed an ME-based source. Moreover, market demand in Europe is low but buyers there have limited stock. In the absence of competitive import offers, European mills are trying to increase prices. Meanwhile, domestic offers in Vietnam are very competitive. A combination of these factors playing out in major importing countries kept Indian mills out of the exports market.
Market updates:
1. HRC import offers to ME increase w-o-w: Chinese HRC offers (grades: S235 and S275) rose by $5-10/t w-o-w to $580-585/t CFR UAE, compared to $575/t last week. However, trade activities remained limited in the region as buyers are in a wait-and-watch mode. Furthermore, no firm offers were seen from other competitive origins like Japan and India. Last heard offers from Japan were at $580-590/t CFR UAE. No fresh offers have been heard from Indian mills. However, market sources expect Indian mills to resume HRC export offers to ME at the end of the month.
2. Vietnam's import offers range-bound w-o-w: Imported offers of China-origin HRC (SAE1006) into Vietnam remained range-bound w-o-w at $555-565/t CFR Vietnam. Chinese participants have just returned from Labour Day holidays. However, HRCs on the Shanghai Futures Exchange (SHFE) rose by RMB 53/t ($7/t) to RMB 3,871/t ($536/t) w-o-w against RMB 3,818/t ($529/t) on 30 April. In addition, Hoa Phat has increased its monthly HRC (SAE1006, non-skinpassed) prices by $27/t for July, 2024 sales, sources informed BigMint. Post-revision, effective prices stood at $580/t or VND 14,670,000/t for the southern region, excluding VAT.
3. Indian mills continue to hold HRC offers to EU: Indian steel mills continued to hold their HRC export offers (S275, 3mm) to Europe this week as well. However, mills are expected to start offering this week for June-July 2024 shipments, hinted market sources. The European domestic market remained largely stable with a slight rise in prices due to restocking activities. Prices are anticipated to move up in the near term due to the absence of import competition despite slow demand in the region.
Outlook
Chinese participants have just returned after Labour Day holidays. Post-holidays, SHFE futures have increased sharply w-o-w. Chinese exporters are also trying to quote higher in the absence of other competitive origins. Moreover, Indian mills are more focused on the domestic market due to limited export allocations amidst maintenance shutdowns and higher domestic realisation. Market participants opined, "Indian mills may resume HRC export offers to the EU towards the end of this week for June-July 2024 shipments."