Although Chinese HRC exporters have been cautiously positive on prices amid increased stimulus hopes, other Asian suppliers like those from India have maintained their prices relatively stable, while some have even decided to go lower, such as Vietnam’s local producer Hoa Phat which has cut its domestic HRC prices. At the same time, more deals for ex-Japan HRC have been reported globally, including to the UAE after the end of the holiday there, and to India at more competitive prices compared to local prices. In the meantime, Turkey’s HRC prices have weakened further while the interest in imports has diminished. Local HRC prices in the EU have remained relatively stable, but import offer prices decreased amid minimal trade, with only occasional deals reported with additional discounts.
Chinese HRC exporters including both mills and traders have decided to go slightly higher in their new prices to overseas buyers, as cautiously optimistic sentiments have started to appear in the Chinese market amid increased stimulus hopes, with HRC futures prices moving up. Specifically, export offers for boron-added SS400 HRC given by major Chinese mills are at $495-500/mt FOB for January and February shipments, with a midpoint at $497.5/mt FOB, up by $2.5/mt week on week. Besides, offers from smaller mills have settled at $480-485/mt FOB, against $475-485/mt FOB last week, though, according to sources, more mills have already been targeting $490/mt FOB. However, the trade activity of Chinese exporters has remained limited given the low demand in the main trade destinations. The tradable levels for ex-China SS400/Q235 HRC have moved to around $485-490/mt FOB, up by $5-10/mt week on week. However, by the end of the week, several deals for around 30,000 mt in total are reported to have been signed to the UAE at $515/mt CFR, which translates to around $480/mt FOB. In the meantime, any strong fundamental improvement is still doubtful as, according to market insiders, local and overseas demand is likely to remain weak, with no improvement in supply and demand seen in China due to the traditional lull during the winter season.
Ex-India HRC prices have been maintained unchanged at $520-540/mt FOB, but the lack of deals has not been surprising considering that mills from China have kept pushing overseas sales to most destinations at sub-$500/mt FOB prices, with workable prices at as low as $480-485/mt FOB also heard, levels which are completely out of bounds for Indian sellers. Offers for ex-India HRC in the UAE have been reported at around $550/mt CFR, against $550-560/mt CFR last week, while suppliers from China were offering their HRC at around $530/mt CFR at the beginning of the week and as low as $515/mt CFR by the end of the week. Offers for ex-India HRC in Europe have remained at $590/mt CFR, which translates to around $535-540/mt CFR, though no interest has been reported from customers due to antidumping duty risks.
At the same time, while Indian exporters have been struggling to boost their sales, Indian importers have been more active, with new deals for ex-Asia HRC in India reported to have been signed at more competitive prices compared to local prices. Specifically, according to sources, around 50,000 mt of ex-Japan SAE1006 HRC have been sold to India at $520/mt CFR this week, while most offers for ex-Japan HRC have been voiced at $525-530/mt CFR. Besides, another deal for around 30,000 mt of ex-South Korea HRC was done at $530-535/mt CFR last week.
Vietnamese steel producer Hoa Phat Group has announced its new hot rolled coil offers for domestic customers, decreasing them on dollar basis by around $11/mt month on month to VND 13,340-13,370/kg ($525-526/mt). However, given the slight rebound in HRC futures prices in China this week, Chinese traders have decided to increase their export offers slightly to Vietnamese buyers as well, though the sustainability of a further price recovery is still questionable. The latest offers for ex-China Q235/SS400 HRC have been reported at $502-505/mt CFR levels, versus the deal prices at $495-498/mt CFR for around 10,000 mt reported a few days ago. This rebound is mainly explained by the recovery of HRC futures prices in China.
Import offers for SAE1006 HRC, however, have remained rare in Vietnam with the SteelOrbis reference price moving to $515/mt CFR, against $510-515/mt CFR last week, based on ex-China indicative offers, while no deals have been reported so far.
In Turkey, HRC producers have been under pressure from low demand and lower scrap prices this week, while there has been a lack of interest from buyers in Chinese material. The mood in the market is generally downwards and, although buyers are pushing for discounts in the import segment to $503-505/mt CFR, versus $515-525/mt CFR in offers, there would still hardly be any significant demand even if such bids were reachable. Currently, Turkish customers do not seem very interested in large purchases with long lead times, following the deals reported previously from Russia at around $530-535/mt CFR. In the Turkish domestic market, HRC prices for end-of-January deliveries have slid from $580-605/mt ex-works to $570-590/mt ex-works, and even lower levels are available for cash payments. In the export segment, the realistic prices are at $550-565/mt FOB, versus targets and official levels at $570/mt FOB and above.
In the UAE, while the week began quietly owing to the holiday, once it ended Emirati buyers in need of stocks showed some interest particularly in Chinese and Japanese materials, also given some optimism about predicted increases in Chinese prices next week. Consequently, although most Chinese suppliers continue to offer SS400 at $520-530/mt CFR, 30,000 mt of HRC has been sold to the UAE by Chinese suppliers at $515-520/mt CFR for January shipment. Furthermore, Japanese suppliers who had been inactive for a few weeks returned to the market and sold some quantities at similar levels to previous deals. According to reports, Japan sold 10,000 mt to the UAE at $540/mt CFR for January shipment. Meanwhile, Indian suppliers continue to seek higher levels in the market but have yet to succeed, with their offers remaining unchanged at around $550-560/mt CFR to the UAE over the past week.
Trade activity has remained weak in the European HRC market this week, with most European suppliers still looking for new orders given their rather short order books. Thus, most domestic HRC prices have failed to increase in new deals, with most offers remaining at the same level as last week. Besides, even though trade activity leaves much to be desired in the region, EU-based mills have been refusing to cut their prices, aiming for €590-600/mt ex-works in new orders. The import market has been quiet as well, with market insiders still waiting for the European Commission to officially confirm new antidumping duties against HRC from India, Vietnam, Egypt and Japan, while a number of foreign suppliers have decided to go lower in their new offers to attract buyers. In particular, import HRC prices have settled at €540-590/mt CFR, depending on the supplier, versus €560-600/mt CFR last week. Offers for ex-South Korea HRC have been voiced at €570-580/mt CFR, though a deal for around 30,000 mt is reported to have been signed at €540/mt CFR.