Indian domestic hot rolled coil (HRC) prices have showed no changes during the past week remaining firm at INR 37,500-38,000/mt ($691-700/mt) ex-works, with most producers maintaining the high-end price in spite of low demand and volume off-take, traders said on Tuesday, May 7.
"Market expectations for producers to make minor downward price corrections have not materialized following the decision of NMDC, the country's largest iron ore miner, to keep its May prices unchanged," a Mumbai-based trader said.
"With producers maintaining prices and no discounts on offer, traders have been cautious about booking large volumes even though select sectors like the auto industry have been showing tentative signs of revival," the trader said.
However, market sources said that one of the major reasons for domestic steel mills to maintain existing prices was persistent low import competition even though import offers were down $10-15/mt on FOB basis.
According to market sources, HRC offers from China are at $590-600/mt, while ex-Japan offers are higher at $620/mt. However, import volumes have remained on the low side with local buyers seeking offers around $570/mt in wake of the rupee weakening against the dollar, the sources said.
The Indian rupee has slipped to INR 54.19 against the dollar.
Traders told SteelOrbis that local HRC prices will move sideways within a narrow range through the current month, with the rupee expected to remain weak, making imports costly, and with steel mills consolidating their margins.