Local Indian cold rolled coil (CRC) trade prices have continued on a downtrend reacting to continued negative growth in key user industries and scarce interest in new bookings in trade channels, with expectations of further downside risks, SteelOrbis learned from trade and industry circles on Monday, May 9.
Sources said that the benchmark 0.9 mm CRC trade price is down INR 800/mt ($10/mt) to INR 80,000/mt ($1040/mt) ex-Mumbai and down INR 500/mt ($7/mt) to INR 80,200/mt ($1,043/mt) ex-Chennai in the south.
“In key user industries like automobiles, the market has noted that 37 percent growth in April sales is misleading as it is on the extremely low base of last year amid lockdown conditions. The month-on-month sales growth is still in very low single-digits and this does not augur well for restocking of raw materials by industries,” a steel sector analyst with a Mumbai-based financial services firm said.
“Mills have cut base prices for May. But this is not enough to drive sales and market participants are expecting more rounds of base price adjustments and hence are deferring new trades,” he said.
Analysts and trade circles pointed out that consumer price inflation surged to a 17-month high of 6.1 percent and input cost increases of mills will keep prices elevated, leading to ‘stagflation’ conditions as rising prices will keep demand at lower levels and this is already being reflected in ever thinning trading conditions.
$1 = INR 76.90.
