Local Indian cold rolled coil (CRC) were maintained at higher levels by integrated steel mills amid brisk trading activity supported by low availability for spot sales from rerolling mills and strong bookings by end user industries, restocking ahead of anticipated boost in festive sales couple of months ahead, SteelOrbis learned from trade and industry circles on Monday, July 26.
CRC base price was quoted at INR 85,000-86,000/mt ($1,142-1,156/mt) ex-works while re-rolling mills’ price was heard slightly higher by around INR 1,000/mt ($13/mt) for ex-Mumbai sales, but latter was reported to be extremely thin as rerolling mills had restricted spot retail sales and instead locked up most of its production for current quarter in long term supply contracts at higher prices with automobile industry.
According to traders and industry officials, for the first time in over a year, every category of the automobile industry—passenger cars, commercial vehicles, two and three wheelers—were in ‘green zone’ in June-July, all categories reporting positive growth rates at the same time.
They said that favourable monsoon across the country and a positive agriculture sector will improve rural economy reflected in faster sales growth rates in rural areas and the festival sales ahead prompted increased restocking by every automobile industry player.
“The changing demand pattern in consuming sectors is making mills adjust their product portfolio and shifting to greater value addition. Demand for hot rolled coil (HRC) is soft while that the CRC is very positive leading to mills increasing output of their rerolling mills,” an official with Steel Authority of India Limited (SAIL) said.
“Our rerolling mills are operating at optimal capacities and all producers are facing challenges in adequately meeting enquiries. Strong demand will drive prices over the next two quarters including festival demand,” he added.
$1= INR 74.40