Defying the overall downtrend in the flat products segment, local Indian cold rolled coil (CRC) prices have showed only a slight downward bias in the past week, finding support with the automobile sector resuming moderate restocking and re-rollers reporting a slight drop in inventory levels.
Sources said that benchmark 0.9 mm CRC prices are stable at INR 57,700-59,500/mt ($674-698/mt) with the higher end of the range effective for ex-Chennai deliveries in the south, down by INR 300-500/mt ($3-6/mt) week on week.
They said that large automobile companies are back placing moderate volumes of bookings with large mills. According to industry circles, the passenger car price increase effected from April 1 by most automobile companies is expected to be absorbed by the market going by early indications and hence the industry is slightly more confident on the raw material restocking front.
In addition, standalone re-rollers have been reporting declines in inventories, with stocks moving faster into the market but supplies of feedstock (HRC) from integrated mills have been tight with a few large mills carrying out maintenance shutdowns.
“The local CRC market has been able to maintain stability owing to better sentiments prevailing in the automobile sector. But optimism needs to be tempered by the fact that restocking by this user segment may be short-lived. We do not think industrials will sustain aggressive restocking and risk large raw material inventories,” a Mumbai-based distributors told SteelOrbis.
“Trade channels are now better placed to replenish stocks from mills as they now have fresh working capital limits available at the beginning of a new fiscal year. This will offer short-term support to CRC prices,” he added.
$1 = INR 86.00
