Local Indian hot rolled coil (HRC) prices have edged lower amid thin trading volumes and even though rate of fall eased, mood in the market has remained bearish on sluggish manufacturing sector growth and buyers preferring to wait for November base price signals from mills, SteelOrbis learned from trade and industry circles on Monday, October 27.
Sources said that trade level HRC price was down INR 200/mt ($2/mt) at INR 46,800/mt ($532/mt) ex-Mumbai and lost INR 300/mt ($3/mt) at INR 49,200/mt ($560/mt) ex-Chennai in the south.
According to the sources, despite sluggish demand seen from industrials, the market expected local mills to seek base price increase of in the range of INR 750-1,000/mt ($9-11/mt) in November, deepening the negative mood in trade circles.
“Local HRC price at the trade level is very close to a five-year low of INR 46,000/mt ($523/mt) seen during the pandemic. Weak demand from industries, declining exports are contributing to serious over-supply in the domestic market. It is difficult to push export volumes when conditions in global markets and trade barriers are a big challenge. At the same time, protectionist measures like the 12 percent safeguard levy are not proving to be effective in checking imports. All factors are leading to increasing pressures on local price,” a Mumbai based distributor told SteelOrbis.
“Producers and distributors will continue to see margin erosions in November-December from rising costs and falling prices. Mills will attempt to offset rising costs by increasing base price which will in turn have further negative impact in trade volumes,” he added.
$1= INR 87.94
