Local Indian cold rolled coil (CRC) prices have suffered significant losses over the past week as key user industries continued to lower bookings, while more users concluded import contracts after terminating long-term supply contracts with Indian re-rolling mills, SteelOrbis has learned from trade and industry circles.
Indian benchmark 0.9 mm CRC trade prices are down INR 1,000/mt ($12/mt ) to INR 63,200/mt ($769/mt) ex-Mumbai and have lost INR 1,200/mt ($15/mt) to INR 61,250/mt ($745/mt) ex-Chennai in the south.
“We are hearing that most of the large South Korean automobile companies in India have either stopped or sharply reduced local sourcing from re-rollers and prefer spot import contracts for ex-South Korea CRC. Local sourcing under long-term supply contracts entails larger carrying costs, which users are unwilling to bear at a time when stock movement of finished products are slowing down,” a Mumbai-based distributor said.
“There is also no clarity on May base pricing from mills. The possibility of a hike is doubted by most market participants. But producers are also very unlikely to cut prices to reverse the market slowdown,” he said.
However, an official at a government mill and another private producer did not rule out a base price increase in May. “We are still assessing the market. There is some volatility in trade but we are also under cost pressures. The only question right now to be decided is whether to effect that immediately or wait for some stability in the secondary market,” a source said.
$1 = INR 82.20