Local Indian hot rolled coil (HRC) prices have remained stable in the past week, unchanged for the fifth consecutive week at INR 35,500/mt ($529/mt) ex-works, against a backdrop of weak demand and the market’s complete lack of appetite for fresh bookings, traders said on Monday, June 20.
“There has been virtually no movement in HRC prices since the imposition of the minimum import price (MIP). The market is in the doldrums and most market participants prefer to stay on the sidelines as they are unsure of the short-term trends in prices,” a Mumbai-based trader said. “There is a lot of stock floating both at the steel mills’ and dealers’ ends. As a result, there is little market activity as fresh buying in current conditions is felt to be too risky,” he added.
Some sources have said that the current market expectation is that local steel mills will adjust July prices to be able to push volumes into the market, but at the same time the sources said that, with no import competition, local steel mills could belie market expectations and continue to hold their base prices unchanged.
Two traders said that they will be compelled to offer discounts of around INR 500/mt ($7/mt), if local steel mills do not adjust base prices as traders are carrying higher-than-usual inventories.