Local Indian hot rolled coil (HRC) prices have come under pressure from sluggish demand and from negative sentiments due to the continuing softening of ex-China offers and expectations of producers making some pricing adjustments to support sagging market conditions, SteelOrbis learned from trade and industry circles on Monday, November 22.
The traded HRC price in India was down by around INR 1,100/mt ($15/mt) over the past week to INR 72,000-72,400 ($969-974/mt) ex-Mumbai, while a deeper discounted price of around INR 71,000/mt ($956/mt) was heard in southern regional markets around Chennai.
According to trade circles, ex-China HRC offers have been heard at around $800-810/mt CFR Mumbai, down from levels of $810-830/mt CFR a week ago and, though the market did not expect any imminent increase in inward volume shipments to increase import pressures, market intermediaries and end-users are expecting market-support initiatives from producers with a price cut to match falling international prices, prompting buyers to defer fresh bookings.
“Prices are under pressures of a correction but the medium-term outlook remains positive. Market participants and distributors are expecting producers to offer some price incentives to drive faster movements of stocks and hence buyers, except for those with very low inventories, are deferring fresh bookings,” a steel sector analyst with a Mumbai-based financial firm said.
“The headroom for producers to hike prices is reduced by the market slowdown. But at the same time, downside risks are also low and hence the traded price will move in a narrow range over the coming weeks,” he added.
$1 = INR 74.30
