Local Indian cold rolled coil (CRC) prices have remained stable supported by the slight revival of restocking reported by the automobile sector but this is perceived to be short-lived, thereby extending the negative outlook for the market.
Sources said that the benchmark 0.9 mm CRC price has been stable at INR 55,400/mt ($663/mt) ex-Mumbai and is unchanged at INR 57,600/mt ($689/mt) ex-Chennai in the south.
According to sources, the market mood improved slightly amid reports that a section of the automobile industry had commenced lifting stocks against long-term supply contracts from re-rollers, while large mills have reported small-volume bookings by industrial users restocking ahead of the festival holidays starting in another week’s time.
“The market showing stability is a positive in a limited way. The restocking seen over the past few days looks to be temporary and is expected to end with the festivals ahead as end-users are very cautious and are careful to avoid building inventories at a time when product sales growth is sluggish,” a Mumbai-based distributor said.
“We still see a lot of downside risks. Local producers will need to continue dropping prices to protect their market share against imports. Most end-users are facing sluggish margins and sales growth and are attempting to cut costs across their raw material supply chain and hence are looking at every cheap import source,” he added.
$1 = INR 83.60
