Local Indian cold rolled coil (CRC) prices have risen for the seventh consecutive week, moving up INR 500/mt ($7/mt) week on week to INR 43,500/mt ($585/mt) ex-works on the anticipation of a sharp upward revision of base prices by domestic steel mills in September, but trading activity has remained muted.
Market sources said that there are a lot of indications available that domestic steel mills will increase base prices by a hefty amount that could range at INR 2,000-3,000/mt ($27-40/mt), but buyers, particularly end-users among automobile manufacturers, have been reluctant to make fresh bookings.
An increase in assembly line output from automobile manufacturers was below market expectations and hence the low trading activity as most automobile makers are unsure whether the much expected spike in sales during the festival months of October and November will actually materialize.
The sources said that users are awaiting August data from key user industries like automotive to determine fresh raw material bookings. While auto sales did improve sequentially, the improvement was still substantially lower than normal and the festive sales bounce is still uncertain.
$1 = INR 74.40