Local Indian hot rolled coil (HRC) trade prices remained stable amid inactive trading conditions as overall demand depression and end use industries cautious over bulk booking during usual lean season of industrial activity, SteelOrbis learned from trade and industry circles on Monday, June 26.
Sources said that HRC trade price remained unchanged over the past week at INR 55,300/mt ($674/mt) ex-Mumbai and marginally down INR 100/mt ($1/mt) at INR 53,900/mt ($657/mt) ex-Chennai in the south.
Market participants held divergent stance on outlook during the current lean season. A section maintained that trade channels which have been away from restocking for past several weeks are now low on inventories and will return to the market reviving demand. However, another section held that with industrial demand continuing to remain weak, trade channels will not risk aggressive restocking.
“There are wide variations in market expectations. Of course rising government expenditure on infrastructure will support demand. But at the same time at the micro level, cheaper imports will continue to put pressures on trade prices,” a Mumbai based distributor said.
“Prices have fallen 4 percent since April. Global demand and price too remain weak. Indian market cannot remain an outlier to global trends. Hence downside risks will get prolonged,” he said.
However, producers continued to remain positive. “Domestic demand from infrastructure projects will continue to drive domestic demand. Surplus export allocations will easily be absorbed in local sales as overseas markets become challenging. Intermittent price volatility is normal but it does not impact overall margins of mills quarter on quarter basis,” an official in Jindal Steel and Power Limited (JSPL) said.
“The market stability is a positive as fall in prices has been checked. This will put less pressure on mills to reduce base prices for July,” he added.
$1= INR 82.00