Local Indian cold rolled coil (CRC) remained unchanged for the second consecutive week at INR 3,100/mt ($522/mt) ex-works amid thin trading activity and pessimism over any immediate recovery in major end-user industries, SteelOrbis has learned.
According to the traders, neither market intermediaries nor end-users were making bookings to restock raw materials as key industries like consumer durables and automobile had posted lower-than-expected sales during the festival months and could not look towards a sustained demand revival in the medium term either.
“Large steel mills are re-working their production, planning to tide themselves over the sustained demand recession. These steel mills are lowering their own value addition of CRC conversion and instead pushing higher export volumes of hot rolled coils (HRC) to ensure inventory management. This explains why these steel mills are not willing to aggressively push CRC volumes in the local market even through discount offers,” a Mumbai-based trader said.
“Several steel companies like JSW Limited are ruling out any immediate recovery in prices and the best case would be some recovery towards the end of the current fiscal year, and hence they are lowering production forecasts over the next few months,” he added.
$1 = INR 71.10