Local India cold rolled coil (CRC) trade prices have remained stable amid the support from the surge in buying by end-user and trade channels and from the buoyant outlook, SteelOrbis has learned from trade and industry circles.
Indian benchmark 0.9 mm CRC trade prices have remained stable at INR 68,000/mt ($851/mt) ex-Mumbai and at INR 68,500/mt ($857/mt) ex-Chennai in the south.
Sources said that, according to preliminary indications, key end-use industries like consumer durables and automobile sectors are expected to report vast improvements in July monthly sales growth, touching pre-pandemic levels. And with the supply chain of imported components improving, automobile majors are expected to start increasing outputs ahead of the festival months of September-October, triggering active restocking of raw materials.
However, a section of analysts and market intermediaries have maintained that the upside potential of trade prices will be limited. They point out that most of the long-term contracts recently concluded by standalone re-rolling mills were concluded at a INR 3,000-4,000/mt ($37-50/mt) discount to current trade prices, indicating a buyers’ market emerging.
At the same time, local prices will remain under pressure from rising import competition. Trade circles said that a southern India-based passenger car major has reported 25,000 mt of ex-South Korea imports for September shipment with a landed price assessed in the range of $750-790/mt.
A southern India based steel processor and packaging company has reported an import trade for 8,000 mt of ex-South Korea CRC with the landed price assessed at $790-800/mt.
“Not only are imported CRC cost-competitive, earlier logistical, port and supply chain bottlenecks have eased considerably, and hence downstream steel processors are looking at imports with much interest. This will keep local trade prices under check,” a steel sector analyst said.
$1= INR 79.90
