Local Indian hot rolled coil (HRC) trade prices have remained largely stable amid bearish sentiments across market segments with section of distributors heard to be pushing sales at discounts and invoice price effectively lower than base price of mills, SteelOrbis learned from trade and industry circles on Monday, June 16.
Sources said that tradeable levels for HRC have remained unchanged at INR 51,100/mt ($593/mt) ex-Mumbai and also stable at INR 52,700/mt ($612/mt) ex-Chennai in the south.
However, a number of market participants confirmed several trades in west and northern regional markets to have been concluded at wider discounts of around INR 1,000/mt ($12/mt) with effective invoice price lower than base price of mills for current month.
The sources said that discounted sales, at price points lower than mills’ listed price, indicated desperate measures among market intermediaries to avoid stockpile and keep cash flows positive. In fact, distributors were already facing tightening of liquidity as they were forced to offer extended credit terms to get buyers to confirm bookings.
“Industrial demand is weakening day by day reacting to monsoon season led disruptions. Every section of the market is cautious over risks of inventory build-up. Mills too are not offering any support to the market as indicated by the fact that all large and medium scale producers decided to maintain higher base price for June despite slowdown in mill-to-market stock movements,” a Mumbai based distributor told SteelOrbis.
$1 = INR 86.21