Inflation coupled with widespread currency devaluation versus the dollar has created a state of ruckus for steel importers globally. European buyers of hot rolled coil have halted their purchases amid the record devaluation of the euro against the greenback.

Indian HRC exports to their major market trio – Vietnam, the Gulf Cooperation Council, and Europe – have become unviable. Following the multiple deals concluded by Chinese mills for SS400 grade HRC at $565-575/tonne cfr Vietnam, there is a huge offer-bid gap in Vietnam for Indian material. The competition – South Korea and China – in the GCC market is giving Indian suppliers a tough time.

European buyers are still rejecting boron-added Indian structural-grade HRC and the recent currency fluctuations have dented sentiment for re-rollable HRC as well. Indian HRC prices are assessed at $595-605/t fob India.

Conversely, Indian mills feel demand for HRC will rise in their domestic market, especially after the festive season in October. Moreover, all major steelmakers are mulling hiking offers for HRC in the domestic market by a further INR 700-1,250/t ($8.56-15.29) for October deliveries. It is anticipated that mills will shift the majority of their export allocations to the domestic market, sources tell Kallanish.

“The cost of steel production in India is very high and mills are trying to pass on the cost burden to the customers,” says a source. “Seeing the current situation in the global market, we don’t see much acceptance coming from importers and it is difficult to say if they [customers] will accept any price hike.”

“The only option left for passing the cost burden is to pass it to the domestic market, which absorbed the previous hikes in September, and possibly the domestic market will further accept the hikes in October as well,” the source adds.

This week, initial quotes for boron-added 2mm+ SAE 1006 Indian HRC were heard at $650-655/t cfr GCC, equating to $610-615/t fob India. However, most sources claim this is just an indication and deals will conclude at much lower levels.

“The GCC is not active right now … and $650-655/t cfr is just a random number the Indian mills are indicating,” says a trading source. “If they receive a firm enquiry for big quantities, they will sell material at $600/t fob levels also.”

According to a source, an Indian mill recently sold around 5,000 tonnes of structural-grade HRC in Europe at €720/t ($690) ddp Spain. Another mill has also offered re-rollable-grade HRC to Italy at $660-670/t cfr; however, the deal has not been concluded.

Offers for DC-01 cold rolled coil are hovering at $810-820/t cfr Antwerp.

Meanwhile, in the Indian domestic market, offers for E250-grade HRC have surged to INR 57,500-58,000/t ex-Mumbai. Offers for E350 and GI are heard at INR 60,000-60,500/t and INR 66,500/t ex-Mumbai, respectively.