Prices in the local Indian cold rolled coil (CRC) market have remained stable for the third consecutive week at INR 53,500/mt ($746/mt) ex-works, amid falling trading volumes in anticipation of a base price adjustments by domestic steel mills next month, traders said on Tuesday, November 20.
“High steel mill level inventory and higher import shipments indicate a base price adjustments by local steel mills next month. I am not sure steel mills will sacrifice margins to push volumes but the buyers—dealers and end-users are reducing fresh booking expecting such a base price reduction nonetheless,” a Mumbai based trader said.
Market sources said that market reports suggest a divergent trend among large steel mills. Some mills are increasing imports of hot rolled coils (HRC) to make up for shortfall in own production and ensure maximum capacity utilization of their CRC rolling mills. But at the same time, some steel mills are facing mounting inventories of finished CRC stocks.
At the same time, auto sales have been on a downturn or flat over the past several months and manufacturers were further tightening raw material inventory controls and these mixed signals were resulting in negative sentiments among traders, the sources added.
The sources said that local steel mills are reportedly exploring lowering base price by INR 500/mt next month.
$1 = INR 71.37