Local Indian cold rolled coils (CRC) prices have lost ground over the past week, but the pace of the decline has eased amid divergent outlook on demand from key user industries and sustained low stock movement in distribution channels, SteelOrbis learned from trade and industry circles on Monday, June 27.
The Indian benchmark 0.90 mm CRC price is down INR 600/mt ($8/mt) to INR 69,000/mt ($881/mt) ex-Mumbai and down INR 500/mt ($6/mt) to INR 69,400/mt ($886/mt) ex-Chennai in the south.
According to sources in trade circles, sharp declines in prices have eased and prices are expected to remain range-bound as there are differing assessments of the medium-term demand outlook from key user sectors like automobiles, consumer durables and industrial products.
A section in trade circles holds an optimistic demand outlook based on the triple-digit growth achieved by automobile manufacturers in May sales, with the latter expected to push up outputs in the coming months.
However, another section pointed out that the triple-digit growth was from a low base in the previous year and also that rising costs of finance for purchasing vehicles and costs of fuel would provide strong headwinds to maintaining such strong sales growth, and end-users are unlikely to hurry to increase raw material restocking based on just one month’s performance.
Those holding bearish sentiments also said that very few standalone re-rolling mills have been able to conclude long-term supply agreements even after the lapse of the first quarter of the current fiscal year, indicating a depressed demand outlook among end-use industries.
$1 = INR78.30
