Although ex-India hot dip galvanized (HDG) prices have been maintained relatively stable during the past week given the still sluggish demand overseas, the mood among Indian exporters is more negative than positive. Besides, talk about several deals signed in the Middle East with additional discounts has been circulating in the market this week.
Sources said that ex-India HDG (Z120) prices have been kept unchanged at $680-730/mt FOB, with no official deals confirmed by any large mill. However, the market has been rife with rumors that at least two deals for 5,000 mt and 8,000 mt were done for deliveries to the UAE and Qatar at prices in range of $680-700/mt FOB. At the same time, a large section of the market dismissed such reports as “speculative and the prices too low” based on two factors. Firstly, they said that any mill selling at such a discounted price would have zero margin and, secondly, the market in the Gulf is fully stocked and hence emergency purchases could also be ruled out.
However, two other traders speculated on the possibility that a purchase contract between buyer and seller had been signed earlier and that the invoice was drawn up later, with the possibility of contract cancellation forcing additional discounts.
Meanwhile, offers for ex-India HDG Z140 in southern Europe have been estimated at $800/mt CFR, down by $5/mt week on week, which translates to around $740-750/mt FOB.
At the same time, offers from India cold rolled coil (CRC) suppliers have been voiced at around $645-650/mt FOB, with offers for ex-India CRC reported in Europe at $700/mt CFR, down by $5/mt week on week.
“Market reports on exports are very unreliable. The fact is that ex-India flat product exports are almost at a halt in reaction to the failure of market improvements in China and a glut in the flow of volumes in most destinations. Sellers have multiple reasons to offer misleading data,” a source at a private mill told SteelOrbis.
“It is also a fact that no large mill has committed any export allocation for the current and coming quarters,” he added.