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BigMint: India HRC export index stable in recent deals

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BigMint Bureau

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30 Jan 2024, 18:09 IST

BigMint: India HRC export index stable in recent deals

Recent deals for ME, EU regions

Market sentiment stable across regions

BigMint's India HRC (SAE 1006) export index (for the Middle East and Vietnam) continued to remain flat this week at $600/tonne (t) FOB east coast India, amid recent deals concluded for the Middle East (ME) and Europe (EU) region.

Rationale: One confirmed deal (T1) was reported in this publishing window. Nine indicative prices were considered as T2 inputs out of twelve inputs received. The final price was an average of T1 and T2 inputs, which stood at $600/t FOB. CFR prices were converted to FOB by deducting freight costs from the buyer or seller.

Market updates:

1. HRC export offers to ME stable w-o-w: Indian steel mills' offers to the Middle East (ME) remained range-bound w-o-w to $635-640/t CFR. A steel major in India has booked around 20,000 tonnes of HRC, informed reliable sources. "Market activities in the ME region is very stable, nothing booming just the regular business," hinted an ME-based source. Moreover, Chinese prices are also stable w-o-w at $610-615/t CFR UAE, while Shanghai Futures Exchange (SHFE) HRC futures are on higher side. Furthermore, Vietnamese HRC offers were also heard at around $640-645/t CFR UAE.

2. Indian HRC export offers to EU remain steady: Indian steel mills maintained their export offers for hot-rolled coil (HRC) shipments to Europe for the second consecutive week. Current offers are around $720-725/t CFR Antwerp ($670-675/t FOB east-coast India). Moreover, a deal was heard concluded to EU of more than 20,000 t from an Indian steel major at similar price levels. European HRC prices stayed high, with offers around EUR 750-770/t ($811-833/t) ex-works. Despite weak demand, limited supply continued to prop up prices. However, concerns are emerging about the long-term viability of this trend, as several blast furnaces may restart operations in the coming months, potentially increasing supply.

3. Indian HRC price indications to Vietnam range-bound w-o-w: Indian HRC export price indications to Vietnam remained flat w-o-w at $610-615/t CFR Ho Chi Minh City, Vietnam. In addition, small quantity deals were heard reported, informed sources. Chinese HRC (SAE1006) offers remained range-bound at around $605-610/t CFR with lunar holidays approaching in China. However, the Chinese SHFE HRC prices went up by RMB 69/t ($10/t) w-o-w to RMB 4,101/t ($574/t) against RMB 4,032/t ($564/t) on 29 January. In addition, Vietnam's HRC import market sentiments remained weak amid low demand.

Outlook:

While recent deals offer a positive sentiment, the outlook for Indian HRC exports remained mixed. The stability in the Middle East and high prices in Europe are encouraging, but Chinese competition and potential supply increases in Europe, along with weak Vietnamese demand, pose challenges. Lunar holidays in China may also attribute to volatility in the market.