Local Indian cold rolled coil (CRC) prices of integrated steel mills inched up on buoyant bookings from key user industries like automobile and standalone rerolling mills reporting operating at maximum capacities but having locked up almost entire production in current quarter in long term supply contracts, SteelOrbis learned from trade and industry circles on Monday.
CRC prices of integrated steel mills inched up to levels of INR 85,000-86,000/mt ($1,139-1,152/mt) ex-works again, compared to INR 82,000-84,000/mt ($1,099-1,125/mt) ex-works a week ago, on rising bookings as no volumes were available from rerolling mills on spot basis.
“We are facing challenges in committing supplies to our buyers. Auto companies are restocking aggressively in order to build up inventories for festive season sales just 2-3 months ahead. Our plants are operating at 100 percent and we have very little volume available for retail or spot sales,” an official with Kalyani Steel, a key auto sector supplier said.
According to a Mumbai based steel distributor, having improved June sales with high double digit growth on year-on-year basis, passenger car makers have very little inventory and gearing up to build up stocks for festive sales and hence the rush to restock raw materials, providing support to local CRC prices.
“In contrast to basic hot rolled coil (HRC) market which is seeing a slowdown, value addition is offering value realizations in case of CRC. We see this as a new dynamic of increasing focus on HRC export and higher output of rolling mills of CRC for optimal sales realizations,” an official from ArcelorMittal Nippon Steel Limited (AMNS) said.
$1= INR 74.60