Local Indian cold rolled coil (CRC) prices have shown limited movement over the past week despite base price increases by large mills, indicating weak demand and the slow movement of stocks in the market, SteelOrbis learned from trade and industry circles on Monday, December 22.
Sources said that benchmark 0.9 mm CRC prices are stable at INR 50,500/mt ($563/mt) ex-Mumbai, but have gained a modest INR 200/mt ($2/mt) to INR 55,500/mt ($619/mt) ex-Chennai in the south.
According to the sources, even though large mills have increased base prices in late December, standalone re-rollers have continued to report higher-than-normal inventories with a few buyers on long-term contracts continuing to defer purchases of stocks.
It was pointed out large industrial users led by the automobile industry have remained cautious as regards restocking raw materials. The automobile sector, despite logging robust sales growth in November on year-on-year basis, is expected to see a slowdown in growth rates in the months ahead, prompting a more conservative raw material procurement strategy, resulting in a slowdown in the movement of material in the market.
“The outlook for the market is neutral. The base price increase by mills is meeting resistance. There are no positive drivers in user sectors. We expect CRC prices to move in a narrow range. Year-end considerations will kick in soon and market activity will fall,” a Mumbai-based distributor told SteelOrbis.
$1 = INR 89.57