Prices in the local Indian hot rolled coil (HRC) market have remained stable during the past week at INR 46,500/mt ($691/mt) ex-works, amid mixed trading conditions, traders said on Monday, May 14.
Market sources said that activity has been down in select regions like western Indian regions, with reports that some traders are offering small discounts to keep inventories moving.
The sources said that, with HRC prices moving up sharply, traders in the west of India are unwilling to incur high carrying costs for large inventories and hence are offering discounts to manage stocks and cash flow positions.
“Regional disparities have sharpened since local HRC prices surged since early this month and since local steel mills increased base prices,” a Mumbai-based trader said.
“While demand from end-users in northern India's manufacturing belt is seen to be holding up, off-take by end-users in the western regions seems to have been impacted by higher HRC prices and both market intermediaries and end-users have become cautious and are avoiding large-volume transactions,” he added.
According to two other traders, the market does not have a clear indication of mills' HRC stocks but expectations in the market are that the tight supply position which supported prices could ease in the coming weeks, as export shipments by Indian steel mills are showing signs of tapering off and any resultant increase in mills' inventories would trigger a cooling of prices.
$1 = INR 67.52