Local Indian cold rolled coil (CRC) trade prices have moved up reacting to base price increases announced by mills and improved bookings from end-use industries led by automobiles, which beat analysts’ forecasts by sustaining strong double-digit sales growth and increased raw material restocking, SteelOrbis learned from trade and industry circles on Monday, February 6.
Indian benchmark 0.9mm CRC trade prices have gained INR 700/mt ($9/mt) to INR 65,400/mt ($799/mt) ex-Mumbai and are up INR 500/mt ($6/mt) to INR 64,050/mt ($782/mt) ex-Chennai in the south.
The sources said that, despite strong sales growth reported by most automobile companies and improved new bookings, CRC price gains have been the slowest among all flat product categories and cited the still comparatively higher inventory levels, mostly at standalone re-rolling mills.
The upside potential of CRC prices has also been limited by uncertainties hovering over ongoing long-term supply contracts between re-rolling mills and large end-users in the automobile industry with no reports of successful conclusions of April-June deliveries at higher price levels, trade sources said.
They said that, if long-term supply contracts for the next quarter were able to be concluded at significantly higher levels than ongoing supplies, this would offer support for the spot market to gain ground.
According to a steel sector analyst with a Mumbai-based financial advisory firm, the potential price increase for local CRC is also being limited by the narrow price differential with ex- South Korea imports. He said that the landed price of imported CRC is now currently at INR 64,000/mt ($781/mt), almost on par with local trade prices, and higher import competition would limited the ability of mills to push up prices for this flat product category.
$1 = INR 81.90
