Indian steel mills have increased local hot rolled coil (HRC) base prices by around INR 2,500/mt ($34/mt) for December deliveries, according to information collated by SteelOrbis from producers and traders on Friday, December 4.
With the latest round of price hikes the effective base price for the current month increases to INR 47,500-48,000/mt ($643-650/mt) ex-works, traders said.
They said that current base HRC prices have touched their highest level since 2008 and have increased 32 percent since July this year.
According to a report by Morgan Stanley, “The increase in December prices was well expected and our checks in the market indicated that prices can be increased again in mid-December.” The report said that local Indian HRC prices are still at a discount of six percent over the landed price of imports and domestic producers still have further headroom to increase prices if international prices continue to hold.
Indian steel mills have been focused on sales in the local market and were considering sales of only limited volumes to the export market at higher prices. The latest booking by one of the Indian producers was at around $640/mt FOB to Europe and after that offers increased to $665/mt FOB. “Some Indian mills are offering at $730-735/mt CFR to Europe [translates to about $700/mt FOB], because the market is mad,” a trader told SteelOrbis.
In the Asian market, prices have not reached such highs so far, so Indian mills have decided to stay away from sales to Vietnam, preferring higher-margin sales in the local market or some limited transactions to Europe.
$1 = INR 73.90
