Bearish sentiments have deepened in the local Indian hot rolled coil (HRC) market, with trade prices continuing to seek lower levels amid a lot of chatter of more discounted sales by distributors, and mills’ attempts to increase prices are heard to be backfiring, SteelOrbis learned from trade and industry circles on Monday, January 15.
Sources said that HRC trade prices have lost INR 400/mt ($5/mt) to INR 57,200/mt ($690/mt) ex-Mumbai and are down INR 400/mt ($5/mt) to INR 57,950/mt ($699/mt) ex-Chennai in the south.
Several in trade circles have reported intense market talk being heard that several distributors, particularly in western and northern regional markets, have been pushing sales at deep discounts often at as low as INR 53,000-54,000 mt ($640-652/mt) ex-warehouse basis, down by INR 1,000 ($12/mt) over the past week.
Sources said that large integrated mills which had earlier in the month had attempted to increase ex-mill list prices by around INR 1,000-1,500/mt ($12-18/mt) have rolled back the hikes in the face of strong resistance from buyers and a significant slowdown in fresh bookings even by large industrial users. “The timing of the price increases sought by producers was clearly wrong, coming at a time when the market is sliding into a negative zone. Producers have discovered that there is demand but only at a low price level,” a Mumbai-based distributor said.
“There are no positive drivers in sight in the short term. Trade prices will either continue to weaken or at best remain range-bound,” he added.
$1 = INR 82.90