Local Indian cold rolled coil (CRC) trade prices have lost ground compared to base price, but have remained at a premium to the lower base prices announced by mills over the past week amid market expectations of a strong rebound in restocking as user industries plan to ramp up production ahead of the festival season, SteelOrbis learned from trade and industry circles on Monday, August 8.
Indian benchmark 0.9 mm CRC trade prices have lost INR 500/mt ($6/mt) to INR 67,500/mt ($852/mt) ex-Mumbai and are down a similar INR 500/mt ($6/mt) to INR 68,000/mt ($858//mt) ex-Chennai in the south.
According to the sources, the decline in trade prices has been limited, and trade prices are now at a premium of about two percent in Mumbai and other regional markets supported by strong bookings by trade channels as key consuming industries like automotive are expected to go in for robust raw material restocking, having already announced planned output hikes during the September-November period.
“The festival months ahead will see a strong demand surge in consumer durables and passenger cars despite rising inflation. Most CRC consuming industries have announced planned increases in output for the traditional high-demand months. Trade channels are stocking up aggressively. Coupled with output cuts by mills, this is leading to marginal premiums at trade price levels as supplies are tightening,” a Mumbai-based distributor said.
“However, at the same time, trade prices can once again settle at a discount to base prices once restocking by trade is completed over the next couple of weeks. There have been stray reports of standalone re-rolling mills receiving bids for spot sales seeking discounts of around INR 2,000/mt ($25/mt) from non-automobile sectors,” he said.
$1 = INR 79.20