Local Indian cold rolled coil (CRC) prices have come under renewed import pressure and moved down by INR 500/mt ($8/mt) during the past week to around INR 39,000/mt ($613/mt) ex-works, as stocks held by market participants piled up, traders said on Tuesday, July 7.
"Support from the hike in import duty last month has proved to be short-lived. There has been a sharp fall in stock movements at the dealers' end and local mills have kept July prices unchanged, dampening sentiments with buyers deferring fresh deals," a Mumbai-based trader said.
"Unlike other flat steel products, ex-China CRC import offers have been sharply reduced and, with local mills keeping their base price unchanged, interest has shifted to imports putting pressure on local prices," the trader added.
Sources said that responding aggressively to the recent hike in import duty on flat products, ex-China CRC offers have quickly been adjusted, declining by $5-10/mt to the range of around $450-455/mt CFR Mumbai for August shipments. The volumes of import transactions reported in the market have been at low levels, but have exerted renewed pressure on local prices given the sluggish demand in the domestic market
It seemed during the week that the Indian rupee was shrugging off the impact of the Greek crisis and global currency trends and the rupee has in fact gain strength during the period.
The Indian rupee, which late last month had been threatening to breach the INR 64 a dollar mark, has actually strengthened to INR 63.40 a dollar and local importers are waiting for a firm upward direction to make fresh import transactions, which is expected to put further pressure on local CRC prices, the sources added.
$1 = INR 63.57