Local Indian cold rolled coil (CRC) prices have continued to soften for the second consecutive week, moving down by INR 500/mt ($8/mt) during the past week to around INR 47,000/mt ($744/mt) ex-works amid persistent falling demand and high stocks at dealers, traders said on Friday, December 19.
According to a Mumbai-based trader, a combination of year-end considerations, high stocks at dealers and thin demand have forced buyers to stay away from the market.
The very fact that local CRC prices have continued to lose ground despite negligible import transactions given the weakening of the Indian rupee reflects the fundamental weakness of demand and the negative outlook for flat steel products, he added.
Market sources have said that buyers are waiting for local steel mills to adjust their prices since inventories at mills are also reported to be high, but so far the mills have given no indication of factoring in low demand into their pricing, thereby forcing buyers to postpone fresh bookings.
Local mills are not expected to make a call on adjusting their prices before the end of January when they will be under some pressure to liquidate stocks and improve cash flows during the January-March quarter, ahead of March 31, the end of the financial year, sources added.
$1 = INR 63.13