Posted on 11 Oct 2023
Hot rolled coil buyers in the Gulf Cooperation Council have lowered their bids to $10-15/tonne below Chinese offers. They have been cautiously monitoring the price decline in China that began earlier this week right after the week-long Golden Week holiday.
Ex-China first-tier silicon control (0.3%) HRC price offers are pegging at $575-585/t cfr Jebel Ali through major Chinese trading companies for December shipment, notes Kallanish.
Late last week, the region's largest re-roller put out an enquiry for several re-rolling grades for a 20,000-25,000-tonne parcel, seeking December shipment.
The Japanese major surfaced its initial offer of 2mm SAE1006 grade at $595/t cfr Jebel Ali for January dispatch; the price is negotiable for large volumes.
In Saudi Arabia, there are a few enquiries for 1.2mm SPHT-1 grade for December shipment, for which the ex-China first-tier mill has quoted at $614/t, while a rival Chinese mill has quoted at $600-605/t, both cfr Dammam port. Due to the holiday, an ex-Taiwan price offer has yet to surface.
The only HRC producer in the GCC, the Saudi mill, has no allocation for December because of its maintenance shutdown and did not invite enquiries from buyers to quote. In fact, it is reported to have released an enquiry to purchase HRC, which has halved to 30,000t from the original enquiry floated a month ago. One source indicates the mill’s hot strip line has “severe technical issues” which could impact output beyond December.
"Buyers know it is never a good time to book when prices are on a downtrend. Chinese domestic demand is poor; import appetite is weak in Türkiye after the war sparked in the Middle East, since Israel is the biggest importer of Turkish iron and steel products. In this conjuncture, the most viable HRC trade activity is in the GCC, and buyers want to ink deals with price advantage," explains a senior trading company official.
Source:Kallanish
