Local Indian cold rolled coil (CRC) prices have continued their uptrend on the back of continued large bookings from key user industries and low inventories reported by rerolling mills, which hence are seeking extended delivery timelines.
Sources said that benchmark 0.9mm CRC prices are up INR 600/mt ($7/mt) to INR 61,800/mt ($745/mt) ex-Mumbai and are up INR 1,000/mt ($12/mt) to INR 62,250/mt ($751/mt) ex-Chennai in the south.
They said that a number of southern India-based rerolling mills have been seeking extended delivery timelines for existing bookings, as they are facing tight supplies of hot rolled coil (HRC) from integrated mills, leading to regional supply-side disruptions.
“Even though market conditions remain positive and producers and trade channels are in a good mood, there are some clouds on the horizon, particularly in key consuming sectors like the automobile industry. Conflicting market dynamics between automobile dealers and manufacturers are creating a lot of uncertainty as regards raw material restocking by the latter,” a Mumbai-based distributor told SteelOrbis.
“Inventory of passenger cars at retailers are at an all-time high of over 60 days. Normally this should be sufficient to meet the festive season demand spike in October and November. If so, new bookings and restocking of raw materials by auto makers may not be as aggressive as anticipated. Car dealers will resist taking more deliveries as inventories are already high forcing auto companies to pull back plans for significant output increases,” he added.
$1 = INR 82.90