Local Indian hot rolled coil (HRC) trade prices have remained stable at lower levels amid weak trading conditions and market participants maintaining a negative outlook on demand and the inventory situation across segments, SteelOrbis learned from trade and industry circles on Monday, February 5.
Sources said that, while trade prices have remained unchanged at INR 57,000/mt ($685/mt) ex-Mumbai and are stable at INR 57,650/mt ($693/mt) ex-Chennai in the south, most of the limited buying activity has been restricted to discounted deals in the range of INR 54,000-56,000/mt ($649-673/mt) depending on booking volumes.
“Prices will continue to remain under pressure from the inventory rise at both mill and trade levels. Ex-China import bookings during the past week have been heard at levels of 30,000-45,000 mt, which has built up bearish pressures on the market,” a Mumbai-based distributor told SteelOrbis.
“The slowdown in overall manufacturing is impacting sentiments and demand weakness will be an extended one going forward. Only need-based buying activity is being heard in the market. No industrial user is keen on building up raw material inventories amid uncertain demand for finished products,” he added.
However, a section of producers has maintained that the current price correction is nearing the end of the cycle, and some recovery could be expected following the government’s continued stress on infrastructure investment in the recent national budget for 2024-25.
“The continued government spending will offer a counterforce to the price correction that we are seeing for the past few months. There will be challenges in the market of course, but we are hopeful of some recovery from the end of March,” a source at Tata Steel said.
Replying to the possibilities of a price hike by mills, the source said, “We are constantly monitoring market conditions. We must take a calibrated approach on hiking prices, factoring in the rise in input costs of coking coal and balancing it with the depressed market conditions.”
$1= INR 83.20