Local Indian hot rolled coil (HRC) trade prices have continued their downslide over the past week amid a demand slowdown in industrial sectors and buyers retreating for the festival holidays, with a divergent short-term outlook expected once business activity resumes after the break, SteelOrbis learned from trade and industry circles on Monday, October 20.
Sources said that HRC trade prices have lost INR 1,000/mt ($11/mt) to INR 47,000/mt ($534/mt) ex-Mumbai and are down INR 300/mt ($3/mt) to INR 49,500/mt ($563/mt) ex-Chennai in the south.
A section of the market said that discounted deals by large distributors have been heard at around INR 46,500/mt ($529/mt) in the western regional market.
According to trade circles, buyers have kept retreating and deferring bookings, preferring to wait for a new price direction after the holidays. However, market most participants are rather pessimistic about any post-holiday rebound amid sluggish demand forecasts from the manufacturing slowdown.
“While there are expectations in certain sections that conditions will improve after the holidays, weak fundamentals of demand and oversupply do not lend much support to such expectations. Trade prices will continue to seek lower levels as distributors push volumes into the market, which is now possible only at discounts,” a Mumbai-based distributor told SteelOrbis.
“The market will remain in oversupply. New capacities are coming in over the next few months while existing mills are operating at above 90 percent capacity on average. With a demand uptick not on the horizon, pressures will be prolonged,” he added.
$1 = INR 87.89