Local Indian cold rolled coil (CRC) prices have continued to decline amid reports of more industrial users cancelling bookings, while re-rollers have been attempting to liquidate stocks at discounts.
Sources said that the benchmark 0.9 mm CRC price has shed INR 200/mt ($2/mt) to INR 53,300/mt ($628/mt) ex-Mumbai and has also lost INR 200/mt ($2/mt) to INR 54,600/mt ($643/mt) ex-Chennai in the south.
They said that major industrial users in sectors like automobiles, consumer durables and specialised packaging have mostly announced price increases for their products effective from January and amid the expected further slowdown in the pace of sales growth have been extremely conservative in restocking for the last quarter of the fiscal year and have been cancelling CRC bookings with distributors and re-rollers.
“While integrated mills have the option to reduce the rate of conversion of HRC to value-added products like CRC as inventories pile up, re-rollers having already committed HRC offtakes have little option but to continue conversion and seek to attempt reduce inventories from booking cancellations through discounted sales,” a Mumbai-based distributor told SteelOrbis.
“Buyers only in immediate need of CRC are in the market. No large industrial user is restocking for the last quarter of the current fiscal. Trade price hence is still some distance from a new bottom,” he added.
$1 = INR 84.90