Large Indian steel mills have hiked base prices for hot rolled coil (HRC) and cold rolled coil (CRC) on the back of steady demand matched by tight supplies, indicating that the market had comfortably absorbed three previous increased effected over the past two months.
Market sources state that these large integrated mills have hiked base prices by a range of INR 1,500-2,500/mt ($17-28/mt) for all deliveries effective for February.
Following the revision, HRC base prices of mills now range at INR 53,200-54,000/mt ($588-597/mt), with CRC base prices in the range of INR 60,200-61,500/mt ($666-680/mt).
Sources at mills said that repeated hikes by producers reflect current market conditions. While demand remains steady, supplies are tightening as inventories at both distributors and mills are on the lower side.
This, coupled with the fact that trade-level prices for flat products have gained INR 3,000-4000/mt ($33-44/mt) since early January, supports the assessment that the market had comfortably absorbed the three previous hikes without the market suffering any correction.
Notably, declining imports, down about 30 percent in April-December and rising exports, up 33 percent, ensured low import competition and tighter supplies in the local market would play a strong role in determining base price calculations, a steel sector analyst said citing government trade data.
