Local Indian cold rolled coil (CRC) tradable prices have increased on the back of the base price hikes announced by integrated steel mills over the past week, but extremely thin trading volumes and reports of discounted sales have been emerging in the market, SteelOrbis learned from trade and industry circles on Monday, April 12.
Sources said that key consuming sectors like automobiles and consumer durables have been looking at a “bleak April”, with more lockdown restrictions being imposed in key industrial hubs and consuming centers.
They pointed out that the western state of Maharashtra which accounts for about 20-25 percent of total passenger car sales in the country is one of the worst affected by the second wave of the pandemic and that the local government has been considering even stricter lockdown conditions.
Sources said that base CRC prices have moved up to INR 63,500-65,000/mt ($850-870/mt) ex-works, up from the range of INR 58,500-59,000/mt ($783-790/mt) ex-works a week ago. The tradable prices were at the same level as base prices for limited-volumes sales.
However, according to at least two traders, a few trades have been reported at discounts of 2-4 percent on the base price, while most dealers have stayed away from fresh bookings in view of the uncertain industrial conditions ahead.
According to the Federation of Automobile Dealers Association (FADA), retail outlets of passenger cars across some of the worst pandemic-affected regions will need to shut down over the coming days and a large number of cars indented in anticipation of higher festival sales will remain unsold and losses will not be recoverable in the future.
These conditions will naturally force manufacturers which have been increasing the output of their production lines to reverse their production plans and this is already being reflected by their absence from the market for fresh bookings, sources said.
$1 = INR 74.73