India: Rising global prices push mills to revive HRC export offers to ME after five-month gap
...
Indian HRC (SAE1006) export offers to the Middle East (ME) have resumed after a long pause, with several Indian mills now extending offers to the region following a recent deal. This export resumption is likely influenced by increasing Chinese offers and the National Day holidays (1-7 October 2024) in China. Meanwhile, HRC export offers to the European Union (EU) remained stable w-o-w amid sluggish market sentiment in the EU. Additionally, India has utilised 80% of its allocated hot-rolled coils (HRCs) quota of 301,704 tonnes (t) for the third quarter of the calendar year 2024 (Q3CY'24), leaving only 59,502 t available.
1. ME imported HRC price from China rises post-holidays: Chinese HRC export offers for grades S235 and S275 to the ME resumed after the National Day holidays, with offers hovering around $565-575/t CFR UAE for the week. SHFE futures in China increased by RMB 140/t ($20/t), reaching RMB 3,703/t ($525/t) from RMB 3,563/t ($505/t) as of 30 September 2024. However, market sentiment in the ME remains sluggish due to ongoing geopolitical issues. Indian HRC export offers to the ME were quoted at around $530-540/t CFR UAE, with a deal of approximately 10,000 t reportedly concluded at $530/t CFR UAE for November shipment.
2. Vietnam's domestic HRC prices rise: Vietnam's leading steel manufacturers increased domestic HRC prices by $35/t m-o-m for December sales. Formosa Ha Tinh (FHS) raised HRC prices (SAE1006, skin-pass) m-o-m with offers hovering around $545-555/t CIF Ho Chi Minh City compared to $511-520/t CIF Ho Chi Minh City. This price hike follows a similar move by domestic competitor Hoa Phat Group. After Hoa Phat's price revision, the HRC (SAE1006, non-skin passed) prices stood at approximately $550/t or VND 13,624,948/t for the southern region, excluding VAT. The price rise follows a sharp increase in Chinese imported HRC offers.
3. HRC offers to EU unchanged w-o-w: India's HRC export offers to Europe (S275, 3mm) remained unchanged for the week, the last heard offers were hovering around $600-605/t CFR Antwerp ($555-560/t FOB, east coast India). In addition, European HRC prices also remained stable despite producers' attempts to increase them. Buyers doubted demand for higher prices, and imports were uncompetitive due to trade restrictions and long lead times.
Outlook
Indian HRC exports to the ME resumed after a long pause, largely due to the absence of Chinese market participants and a sharp increase in the latter's prices. However, a few mills are still holding back their HRC export offers, expecting an improvement in domestic prices. Additionally, Chinese participants have just returned after the National Day holidays, keeping the outlook mixed as global market participants adopt a wait-and-watch approach.