Local Indian cold rolled coil (CRC) traded prices lost ground during the past week, falling by up to INR 2000/mt ($27/mt) on lower than expected demand growth from the automobile sector and increase of stocks, SteelOrbis learned from trade and industry circles.
Sources said that benchmark 0.9 mm CRC prices, used for re-rolling were down INR 1,500-2,000/mt ($20-27/mt) over the week to INR 76,500-77,000/mt ($1,028-1,034/mt) ex-Mumbai.
Prices of thinner gauge CRC (0.2mm-0.35mm), used for automotive production, were heard at INR 86,000/mt ($1,155/mt) ex-Mumbai, the sources said, down by INR 1,000-2,000/mt ($13-27/mt).
“There is divergence in hot rolled coil (HRC) and CRC markets’ dynamics that is putting pressure on the latter. Over the past quarter, mills have increased volume of HRC for captive conversion to CRC to ensure higher realizations from value addition and strong expected demand from the automobile industry. But with demand from auto sector is falling short of expectations mills are reporting lower HRC stocks with commensurate higher availability of CRC, putting price pressure on the latter,” a Mumbai based distributor said.
“With fall in CRC prices and narrowing of the gap with HRC prices, mills will need to alter their production planning of product portfolio to adjust to changed market conditions. It is likely mills will increase base price of HRC and long products while keeping CRC base price unchanged in the coming month,” he added.
A section of the market said that in view of persistent supply chain disruptions of passenger car makers in sourcing imported components, output increase of festival season ahead will be below anticipation and hence CRC booking increase too will be below expectations.
$1= INR 74.44
