Local Indian cold rolled coil (CRC) trade prices have continued to slide amid negative sentiments from re-rolling mills failing to conclude long-term supply contracts even after the lapse of the first month of the fiscal year, and with growth in auto sales failing to show consistency in April and given expectations of base price cuts in May, SteelOrbis learned from trade and industry circles on Monday, May 2.
Indian benchmark 0.90 mm CRC trade prices have lost INR 1,000/mt ($13/m) to INR 80,800/mt ($1,058/mt) ex-Mumbai and are down INR 1,500/mt($20/mt) to INR 80,700/mt ($1,056/mt) ex-Chennai in the south.
“No reports were heard of any success in concluding long-term supply agreements between re-rolling mills and end-use industries like automobiles. Even after one month of the current fiscal year this can only lead to inventory pressures,” a Mumbai-based distributor said.
“Key user industries like automobile manufacturers are reporting mixed sales growth in April and a lack of consistent growth across product categories is spreading a negative outlook for CRC booking volumes. Price increases for passenger cars and consumer durables are also expected to depress demand and hence raw material demand too,” he said.
A large section of the market indicated that, in view of the rise in inventory levels with re-rolling mills, integrated mills could reduce base prices in May. Market expectations are for a base price cut of at least around INR 1,500/mt ($20/mt), but market players are still sceptical about whether this will be sufficient to revive demand against the overall slowdown faced by key industries.
$1 = INR 76.40
