The brief uptrend in the local Indian hot rolled coil (HRC) market has proved to be short-lived with prices edging down INR 500/mt during the past week to INR 41,800/mt ($599/mt) in reaction to the softening of demand from end-users who fear manufacturing sector growth will remain slow over the next several months, traders said on Monday, April 22.
“It is unlikely that there will be any immediate reversal of the slowdown seen in the manufacturing sector. With the national elections taking place and the results to be announced as of May 23, the new government will take time to settle down and hence policy making will continue to remain in a limbo,” a Mumbai-based trader said.
“Under such circumstances, sentiment among market intermediaries and actual users is extremely weak and no one is willing to conclude significant transactions at present, leading to a steady fall in trading activity,” the trader added.
According to two other traders, most large domestic steel mills are maintaining their base prices unchanged despite a section of the market having had slim hopes of a base price adjustment to stimulate trading and, with such hopes being disappointed, traders have been sharply reducing their restocking activity.
$1 = INR 69.69