Local Indian cold rolled coil (CRC) prices have returned their uptrend against the backdrop of the major boost to sentiments from the robust sales growth reported by passenger car sales in August, a portent for robust festival season sales ahead, and with manufacturers restocking aggressively to increase plant outputs, backed by rising demand from specialized steel packaging materials.
Sources said that local CRC prices are up INR 400/mt ($5/mt) to INR 61,200/mt ($741/mt) ex-Mumbai and are up INR 800/mt ($10/mt) to INR 61,250/mt ($742/mt) ex-Chennai in the south, with several reports from the rerolling industry indicating that the latter were putting a hold on confirming new bookings under pressure from low inventories and integrated mills signaling a base price increase of around INR 1,500/mt ($18/mt) for September deliveries.
“There is extremely bullish mood in the automobile sector, having recorded around 10 percent sales growth in August. If sales growth remains so strong in the normally lean monsoon months, the industry is poised for an even stronger performance during the festival months of October and November. All automobile companies are adding extra shifts at their assembly lines and hence require aggressive restocking of raw materials,” a Mumbai-based distributor said.
“There is some amount of import competition as the landed price of ex-South Korea CRC is at around a 8-12 percent discount to the local price. But we do not see imports impacting local pricing because it will only bridge either incremental demand or meet emergency requirements. There is sufficient domestic demand to absorb supplies, be it domestic or imports,” he said.
$1= INR 82.60