Local Indian hot rolled coil (HRC) prices have come under pressure and moved down by INR 1,000/mt ($15/mt) to around INR 31,400/mt ($480/mt), as buying sentiments took a hit from local mills' refusal to adjust their base prices and amid high inventories held by market participants, traders said on Monday, August 17.
According to a Mumbai-based trader, market conditions have worsened despite low pressures from imports in view of the weakening Indian rupee, reflecting poor demand and buyers' aversion to make fresh commitments, while he added that the lower dealer prices have failed to revive volumes in the market.
The trader said that most of the large local steel mills have ruled out any price adjustments, mainly counting on the falling Indian rupee to keep imports in check, but ignoring the lack of any demand and the piling up of inventories at the dealers' end.
Market sources said that steel mills have also been bolstered in maintaining ex-works prices unchanged due to rumors about the Indian government imposing a safeguard duty on imported flat steel products.
However, at the same time, while imports have become expensive amid the depreciating rupee which breached the INR 65 to a dollar mark, demand for imported HRC has not shifted to local steel products, indicating weak demand from user industries, the sources added.
$1 = INR 65.37