TEX reported that Japan''s integrated steelmakers will offer HR coil exports at a price level of USD 850 per tonne CNF for June and July shipments to distant areas such as the Middle East and Latin America.
It may be noted that the Middle East enters Ramadan for 30 days from August 11th 2010, while people take summer holidays from July in parts of Latin America. As a result, there is a possibility that pre holiday speculative demand for HR coils will arise in the Middle East and Latin America. In this connection, it is likely that the Japanese steelmakers will conduct their HR coil export negotiations with local customers by putting price terms before sales volumes.
At present, Russia''s steelmakers are in course of negotiations on their HR coil exports to the Middle East at around USD 800 per tonne CNF. It is uncertain whether the Russian steelmakers have firmed up deals at the price level in point. Until now, the Russian steelmakers are said to have raised offer prices every time users make inquiries anew.
There are few signs of tight supply-demand conditions for HR coils in the Middle East and Latin America, compared with what was predominant in 2007-08, market observers believe. But various users in both areas are reported as becoming obsessed with anxiety about ascending HR coil prices in a structural change as soaring prices of raw materials. Accordingly, local users'' bids indicate a slow advance in the absence of a surge.
In Latin America, transaction prices of HR coils border on USD 800 per tonne CNF for supplies from various nations. Therefore, it is understood that the Japanese steelmakers'' offer prices of HR coils at a level of USD 850 per tonne C&F could gain acceptance of local customers shortly. Still, a disadvantage of Japanese HR coil exports to distant areas is high freight rates.