Local Indian hot rolled coil (HRC) prices have continued to come under corrective pressure during the past week as demand has deteriorated further, losing INR 500/mt ($8/mt) for the second consecutive week, and are currently at INR 39,000/mt ($634/mt) ex-works, traders said on Tuesday, November 11.
According to a Mumbai-based trader, market sentiments have taken a turn for the worse with local steel mills announcing that their HRC base prices will remain unchanged during November despite falling demand, rising inventories at dealers and lower import offers.
The outlook for the HRC market is very negative as local mills are ignoring market conditions and refuse to pass on benefits of lower input costs like imported coking coal and iron ore, he said. Under such conditions, dealers have no option but to lower market prices to keep stocks moving and maintain cash flows even though their margins are falling rapidly, he added.
Market sources said that ex-China HRC offers have declined by around $5/mt during the past week to $500/mt CFR Mumbai and bookings of Chinese materials for December-January shipments have increased significantly, while transaction volumes for local products have remained at low levels.
$1 = INR 61.52