Local Indian cold rolled coil (CRC) prices have surged on the back of some mills commencing base price increases and given the extended delivery timelines from rerolling mills, and also with major users like the automobile industry facing tight supplies for planned output ramp-ups ahead of festival sales starting next month.
Sources said that benchmark 0.9 mm CRC prices are up INR 1,200/mt ($14/mt) to INR 63,200/mt ($762/mt) ex-Mumbai and have gained INR 1,500/mt ($18/mt) to INR 64,150/mt ($774/mt) ex-Chennai in the south.
They said that low inventories at re-rollers have been forcing them to extend delivery timelines for large-volume bookings by up to 25-35 days against the normal 10-15 days earlier. Not only have average booking volumes from automobile and packaging industries been rising, re-rolling mills are faced with tight supplies of hot rolled coil (HRC) for value addition, prompting the extension of delivery timelines.
“There is a further short-term upside potential for CRC prices. The base price increase by two large mills has been modest and a more aggressive revision is expected in early October. But any increase will be absorbed by the market as supplies are tight and bookings are increasing,” a Mumbai-based distributor told SteelOrbis.
“The next target price is at around INR 65,000/mt ($784/mt) and we do not expect any price correction to set in although trade channels would be more cautious is restocking,” he added.
$1 = INR 82.90
