Local Indian cold rolled coil (CRC) prices have entered a fresh decline in the past week as sentiments have worsened amid possible negative passenger car sales growth in the current month further aggravating low restocking by key industrial users.
Sources said that benchmark 0.9 mm CRC prices are down INR 800/mt ($9/mt) to INR 56,200/mt ($657/mt) ex-Mumbai and down INR 200/mt ($2/mt) to INR 60,700/mt ($710/mt) ex-Chennai in the south.
According to the sources, the market expects more passenger car makers to report negative sales growth for June and possibly reacting with cuts in output and further declines in restocking activity by leading industrial users. “While on the one hand leading industrials are reducing restocking on week-on-week basis as monsoons trigger lower manufacturing activity, some buyers are deferring bookings awaiting more clarity on the base price strategy of mills in July,” a Mumbai-based distributor told SteelOrbis.
“Overall, the market will remain bearish and the mood cautious in the July-September quarter as sales of various sectors will remain sluggish and raw material consumption on the lower side. Distributors too are facing liquidity challenges from offering longer credit terms to buyers and hence have lower leverage to restock,” he added.
$1 = INR 85.48