Indian HRC export prices fall in recent deal to EU ahead of year-end holidays

Indian mills' HRC export to the European Union (EU) declined by $10/t w-o-w to around $695/t CFR Antwerp. Export deals of around 15,000 t were concluded from India to EU, as were recorded by SteelMint. In addition, Indian mills have continued to keep HRC export offers on hold for Southeast Asia and the Middle East (ME) markets as realizations are lower and Chinese prices are very competitive.

Factors influencing offers:

1. Indian HRC offers to EU decline w-o-w: Indian HRC export (S275, 3mm) offers to Europe have declined by around $10/t w-o-w to $695/t CFR Antwerp. An Indian steel major has concluded a deal of around 15,000 t at $685-690/t CFR Antwerp. Although, domestic prices in Europe continued to remain on the higher side. Notably production cuts in EU and re-stocking activities had lifted offers, however, owing to seasonal slowdown price rally has cooled down.

2. Chinese offers for Middle East are range-bound w-o-w: Chinese HRC (SAE1006) export offers to the ME remained range-bound w-o-w to $605-610/t CFR UAE. However, no offers were reported from other major exporters like Japan, Taiwan, or South Korea, adding to the supply uncertainty. Demand in the Middle East is robust and projects are on track.

3. Formosa Ha Tinh raises HRC prices for Feb'24 deliveries: Vietnamese steel major, Formosa Ha Tinh, had raised HRC prices by $25-35/t m-o-m for February 2024 shipments. Subsequent to the revision, prices of HRC (SAE1006, skin pass) stood at $625-635/t CIF Ho Chi Minh City. Meanwhile, non-skin pass coils are assessed at around $620-625/t CIF. Prices rose in line with the supporting price trends in the global market.

The world's top steelmaker Baosteel has increased HRC and thick plates prices for Jan'24 sales by RMB 200/t ($28/t) m-o-m.

Outlook: Indian mills are temporarily shifting their export focus to the EU, attracted by higher realisations and opportunistic price increases sought by European producers for February deliveries. Nevertheless, upcoming New Year holidays might dampen export bookings for a couple of weeks.