Indian hot rolled (HRC) prices have edged up by INR 1,000-1,500/mt ($18-27/mt) to INR 33,000-33,500/mt ($608-616/mt) ex-works levels amid the increase in import prices and the anticipated upturn in domestic demand, Indian traders said on Friday, November 9.
"Imported HRC, ex-China and ex-South Korea, have increased by $15-20/mt on reports of lower production figures in China and hikes in prices announced by several leading producers including ArcelorMittal," a Mumbai-based trader said.
"Indian producers have taken advantage of the upward trend in international prices to withdraw discounts on volumes and negotiate a higher price with buyers," the trader added.
However traders in Kolkata said that the upward movement in domestic HRC prices was not triggered so much by the demand push but rather by limits to production growth in the November-December period in the wake of severe disruptions in availability of iron ore for steel mills.
"The expected seasonal upswing in HRC demand is not too pronounced. However, there may be issues of availability and production growth owing to the shortage of iron ore currently being faced by Indian mills," the trader said.
"A number of steel mills without captive iron ore mines have started importing iron ore. These mills have been taking advantage of the anticipated fall in total inventories in the market to increase HRC prices and offset the higher cost of imported raw material," he added.
According to market sources, integrated steel mills with captive mines are waiting for after the festive holidays next week to gauge the increase in import prices and thereafter adjust their base price by $10-15/mt for December deliveries.