Local Indian hot rolled coil (HRC) prices have edged down by INR 300/mt during the past week to INR 45,700/mt ($666/mt) ex-works but market participants’ outlook has remained positive, traders said on Monday, July 9.
“The slight weakening of the market is not a cause of concern for steel mills as several export contracts will ensure tight domestic supplies and support for prices in the coming week. The marginal losses in prices during the past week are more of a short -term correction,” a Mumbai-based trader said.
“There are no pricing signals from steel mills for current month deliveries. I would expect the mills to maintain their base prices unchanged this month and producers to become more aggressive in pushing export volumes with the Indian rupee creeping towards just below INR 70 against the US dollar,” the trader added.
Market sources said that large mills led by JSW Limited have reportedly finalized an HRC export contract shipment of 20,000 mt to Vietnam, while state-run Steel Authority of India Limited (SAIL) has floated an export tender for 16,000 mt during the past week.
The sources said that several large steel mills like JSW Limited, SAIL and JSPL Limited are said to be setting aside higher volumes to be shipped overseas since the rapid depreciation of the Indian rupee against the US dollar had made export earnings lucrative and such a thrust would ensure that supplies in the domestic market will tighten in the coming weeks, resulting in a bullish impact on local Indian prices.
$1 = INR 68.66