Local Indian cold rolled coil (CRC) prices have remained firm during the past week at around INR 49,000/mt ($814/mt) ex-works amid higher transaction volumes ahead of an expected price hike by local producers and against the backdrop of the increase in import offers, traders said on Thursday, July 17.
According to two Mumbai-based traders, it is only a matter of time before domestic steel mills, which have deferred price hikes this month, will increase their prices, and this has prompted some restocking by distributors.
At the same time, ex-China CRC offers have edged up by $5/mt to the range of $610-615/mt CFR Mumbai for September shipments, providing support for local prices, traders said.
Only small import transaction volumes have been reported in the market during the week, as most traders and importers are waiting for a price increase from local mills, the traders said.
At the same time, with the Indian rupee remaining weak, at above INR 60 to the US dollar, import transactions have remained limited since margins are squeezed by the current exchange rate, the traders added.
Market sources said that restocking has gained momentum on the back of expectations that CRC stocks will start to move faster driven by the revival in the automobile sector and by imports becoming more expensive.
According to data released by Society of Indian Automobile Manufacturers (SIAM), passenger car sales in India were up 15 percent year on year in June 2014, the highest increase in the last 10 months.
$1 = INR 60,11