Indian domestic cold rolled coil (CRC) prices have firmed up by around INR 500/mt ($8/mt) during the past week to INR 49,500/mt ($823/mt) ex-works amid supply constraints in select markets, traders said on Thursday, July 24.
In markets such as Chennai in southern India and Mumbai in the west of the country, distributors are facing supply issues and are not getting required volumes from steel mills for restocking," a Mumbai-based trader said.
Demand for CRC of thickness lower than 1 mm has been rising since early this month, and low stocks at distributors has caused prices to strengthen, the trader added.
Sources said that CRC importers, who were largely idle until recently, have become active and concluded transactions during the past week.
The sources said that ex-Japan CRC has been booked for end of August shipments at around $640/mt CFR Chennai by traders, mostly against advance bookings by their end-use customers.
Ex-China CRC offers too have firmed up by around $10/mt at around $615-620/mt CFR Chennai, but no transactions have been reported in the market since end-users have showed little interest in Chinese origin CRC, the sources added.
Traders said that the increase in dealer prices will likely be supported by an upward revision in base prices by domestic steel mills which has been deferred until August.
Local steel mills are taking time to adjust their prices in order to factor in the recent 6.5 percent increase in railway freight charges which, according to traders, will have a direct impact of about INR 200/mt ($3/mt).