After a brief pause, local Indian hot rolled coil (HRC) prices have resumed their previous upward movement, increasing by INR 1,100/mt ($16/mt) during the past week to INR 37,600/mt ($565/mt), due to the further tightening of supplies from domestic steel mills and due to the expected rise in demand after the monsoon rains, traders said on Monday, October 3.
“Dealers are back making fresh bookings but there are reports that there may be delays in securing deliveries since most steel mills have low stocks and supplies may remain tight for several weeks,” a Mumbai-based trader said.
“The rush to conclude fresh bookings is also fuelled by several government and non-governmental forecasts of a rise in domestic steel consumption as the manufacturing sectors have begun to ramp up capacity utilizations as the monsoon rains have receded from most of the country,” the trader added.
At least two traders state that there are indicators that local steel mills may announce another price hike for flat products this month, which would be the third consecutive hike in base prices in less than two months.
Market sources state that, while Indian HRC exports to Southeast Asian markets in Indonesia and Malaysia continue to remain robust, a few large Indian steel mills report substantial export volumes to Europe, which is also expected to result in tighter supplies of HRC in India.
The sources said ex-India HRC deals are being concluded in the European market in the range of $470-480/mt CFR.
$1 = INR 66.55