Prices in the local Indian hot rolled coil (HRC) market have entered a downtrend during the past week, with prices decreasing by INR 300/mt to INR 46,000/mt ($675/mt) ex-works, even as signals of an export revival failed to mitigate apprehensions of inventory build up across market segments, traders said on Monday, June 25.
Sources said that reports in the market indicated that large steel mills concluded an aggregate HRC export contracts ranging between 15,000-20,000 mt during the past week.
Though the ex-India shipments of HRC is taken to be an tentative indicator of revival of Indian flat product exports, it is difficult to forecast this evolving into a trend and take care of reportedly high inventory build up at mill end which is putting pressures on prices as mills are operating at maximum capacity utilizations, the sources said.
“Local HRC prices are correcting in anticipation that high inventories across market segments might rein in local steel mills from going in for aggressive pricing announcement next month,” a Mumbai based trader said.
“Current HRC prices are delicately poised and much of the short term trend will depend on export bookings of local steel mills and net impact after factoring in inward shipments too. It is reported that a local importer is negotiating an ex-South Korean HRC import contract of 30,000 mt from and local prices will trend on basis on net cross border flow of the material,” he added.
$1 = INR 68.13