Local Indian cold rolled coil (CRC) prices have continued to record significant decreases over the past week in reaction to industrial users having completed raw material restocking to meet expected festive season demand and market intermediaries also retreating at the start of the long holidays ahead, SteelOrbis learned from trade and industry circles on Monday, September 29.
Sources said that benchmark 0.9 mm CRC prices have lost INR 1,100/mt ($11/mt) to INR 55,000/mt ($620/mt) ex-Mumbai and are down INR 1,400/mt ($16/mt) to INR 58,300/mt ($657/mt) ex-Chennai in the south. However, some discounted sales at lows of INR 54,000/mt ($608/mt) have also been voiced in the market this week, according to sources.
Notably, large industrial users led by automobile manufacturers have completed their restocking to meet their festival season demand. The festival season demand uptick was expected to be moderate compared to the previous year and hence restocking volumes were on the lower side, leaving standalone re-rollers with a lot of unsold stock, which is expected to continue to put pressures on prices.
“Major industrials like automobile companies are moderating their expectations of a demand revival in passenger cars following cuts in the rate of the Goods and Service Tax (GST) on vehicles on certain sizes. Tight liquidity of consumers will temper demand in car sales. Hence, manufacturers’ restocking has been much lower than forecast, resulting in unsold stocks which will come into the market at discounts,” a Mumbai-based distributor said.
“Going forward we expect the pressure on prices to continue, with fewer players active in the market and a fall in trade volumes,” he added.
$1 = INR 88.72
