Local Indian hot rolled coil (HRC) prices have surged by INR 1,500/mt ($22/mt) during the past week to INR 42,500/mt ($628/mt) ex-works in anticipation of one of the highest price hikes by steel mills next month, traders said on Monday.
"The market is priming up for one of the highest base price increase by local steel mills in the New Year which could be as much as INR 6,000/mt ($89/mt) across all flat products," a Mumbai-based trader said.
"But as a result of the increases recorded in domestic HRC prices, trading activity on dealers' end has dipped sharply, indicating the limited ability of the market to absorb price increases and tepid demand conditions," the trader added.
Market sources said that rising local HRC prices has also been supported by the increase in export shipments by local steel mills and rising interest from overseas buyers. It is reported that Indian local steel mills' HRC export offers are currently at around $550/mt FOB, which is about $20/mt higher than the few export transactions concluded last month.
$1 = INR 67.72