Local Indian cold rolled coil (CRC) prices have remained at higher levels amid a significant rise in trading activity and improved sentiments triggered by positive signals of the major automobile manufacturing hub in southern India resuming operations, SteelOrbis learned from trade and industry circles on Monday, June 21.
While CRC base prices have been maintained at INR 85,000-86,000/mt ($1,148-1,162/mt) ex-works, volumes and trades saw a significant rise on restocking following the announcement that safety protocols had been finalized and approved for the major automobile manufacturing hub in southern India and a number of passenger car makers moving towards 100 percent capacity utilization levels.
Sources said that disputes over implementation of safety protocols at shop floors have been resolved and major auto companies operating in southern India like Hyundai Motors India Limited (HMIL), Renault-Nissan and Ford, which had halted production last month in the wake of the pandemic are all now ready to resume operations at full capacity, leading to optimism over raw material bookings.
The improving demand from the auto sector is also being strongly supported by fresh bookings for sectors like home appliances and consumer durables, which reported a rebound in sales, the sources said.
Significantly, standalone re-rolling mills have commenced negotiations with integrated steel mills for six-month supply contracts for hot rolled coil (HRC), but the latter are deferring talks on new supply contracts until July base pricing for HRC is announced.
Officials in steel mills said that producers are looking at base HRC price hikes of around INR 3,000/mt ($40/mt) in July, which could translate to a further push to CRC prices of standalone rolling mills.
$1 = INR 74.00