Posted on 27 Apr 2023
The softening global market amid falling Chinese futures has deteriorated booking sentiment around the world. Buyers are holding their purchases and expect sellers, including Indian mills, to drop their offers, sources tell Kallanish.
Indian mills, after dropping their offers recently, have kept their offers firm; however, sources believe that the Indian mills will drop further due to low bookings for May and June shipments.
According to sources, offers for small-tonnage cargoes of structural-grade HRC dropped to $785-790/tonne cfr Antwerp, France, and Spain this week, netting back to $740-750/t fob India. According to sources, limited small tonnage deals were concluded this week and last week at $790/t cfr Antwerp.
Offers for 2-metre wide HRC are at $800-805/t cfr Antwerp. However, Indian mills are focussing more on selling commercial grades in the region.
Meanwhile, bulk offers from India were heard at $750-770/t cfr Italy, depending on the buyer and quantity. There was a rumour that an Indian steel major had reportedly offered bulk HRC at $730/t cfr Italy; however, the deal was not concluded.
Current offers for DC-01 cold-rolled coil plummeted to $865-870/t cfr Antwerp. A few small tonnage deals were concluded at $870/t cfr Antwerp this week.
"The falling Chinese market has plummeted market sentiment globally," a source opines. "Chinese traders taking short-selling positions are driving the overall market, and hence things have turned bearish. This has further slowed the market in Europe, which was itself suffering from sluggish demand for quite a long time."
Indian re-rollable HRC offers in the GCC for May shipment are at $700-720/t cfr GCC for May shipment, netting back to around $680-700/t fob India. The Indian offers continue to remain the costlier option in the region; hence, no deals were concluded.
Vietnam continues to remain unviable for the Indian mills.
In the Indian domestic market, listed offers for E250 grade HRC were heard at INR 61,500-61,750/t ($752.39/t) ex-Mumbai; however, most deals are occurring at INR 59,500-60,000/t ex-Mumbai. Meanwhile, offers for E350 and GP coils are heard at INR 62,000-62,500/t and INR 72,000-72,250/t ex-Mumbai.
A majority of market participants feel that in the short- and medium-term, the new normal offers for Indian mills will be around $650-660/t and $600-610/t fob India, respectively, for European and non-European markets. Indian mills may not immediately agree to it, but considering the unfavourable and sluggish sentiments developing globally and limited sales for May and June shipments, it may push the mills to accept the downtrend.
It is anticipated that either Indian mills will try to push their sales in the domestic market and accept the price downfall globally, or else they will curtail production or go for a planned shutdown.
Source:Kallanish
