Over the past week, prices in the local Indian cold rolled coil (CRC) market have remained stable at INR 47,000/mt ($664/mt) ex-works, but the market has witnessed a sharp fall in activity largely owing to resistance to the base price hikes in earlier weeks and buyers’ caution as regards making fresh bookings at higher price levels, traders said on Tuesday, February 12.
“Clearly the hike of INR 1,000/mt ($14/mt) in base prices in the previous week was too high considering that there is already too much material available in the market and high inventories at steel mills,” a Mumbai-based trader said.
“Bookings by end-users have also been at low levels. Hence, market intermediaries are not interested in restocking and, though prices have not yet softening, it is a matter of time before the market sees a correction from the current high prices,” the trader added.
Market sources said that considerations linked to the end of the fiscal year have also obliged dealers not to build up stocks as end-users have reduced bookings in the local market and prefer import shipments instead as the price differential between domestic CRC after the latest price hike and the landed price of imported CRC has narrowed over the past fortnight.
$1 = INR 70.8