The local Indian hot rolled coil (HRC) market has started to show signs of a correction setting in with prices edging down by INR 500/mt during the past week to INR 42,500/mt ($616/mt) ex-works, as traders and actual users have sharply reduced fresh bookings due to end-of-fiscal-year considerations and their reluctance to build up high-priced inventories, traders said on Monday, March 25.
“Almost all market participants have moved to the sidelines, staying away from concluding transactions and maintaining liquidity as they ready to close their books of accounts for the fiscal year,” a Mumbai-based trader said.
“Domestic steel mills have pushed up HRC prices too rapidly within the last two months, and the market is responding with a fall in transactions. It is difficult to say whether the correction will gain momentum, but prices will remain under pressure particularly with reports of higher volumes of HRC imports from Iran,” the trader added.
Sources said that there have been reports in the market that some dealers in the western region of India are offering discounts of around INR 500/mt to liquidate stocks ahead of the end of the fiscal year, but added that it is too early to say whether the discounting will spread across other markets into the new fiscal year starting next week.
$1 = INR 68.97