Local Indian hot rolled coil (HRC) prices have suffered setbacks in the past week and much of the recent gains have been wiped out due to the combination of a correction from buyers’ resistance, higher-than-expected import arrivals and the weakening of the industrial demand outlook, SteelOrbis learned from trade and industry circles on Monday, April 14.
Sources said that trade-level HRC prices have declined by a range of INR 800-1,000/mt ($9-12/mt), taking effective prices to INR 51,500/mt ($599/mt) ex-Mumbai and around INR 52,300/mt ($607/mt) ex-Chennai.
The sources said that, despite several weeks since the ministry of commerce recommended a 12 percent safeguard duty on imports, the government has not yet given official effect to the levy, impacting sentiments and continued fears on sustained import pressures.
“The correction was much expected. Recent price gains were based on mills hiking listed price on expectations of the levy of safeguard duty on imports and not on fundamentals on the demand side. Hence, buyers are now resisting higher levels,” a Mumbai-based distributor told SteelOrbis.
“However, we see the correction seen so far to be on the lower side. There is some supply-side support since at least two large mills are shut down for planned maintenance. Once these units get back into production around the current month-end, trade downside risks will increase,” he added.
$1 = INR 86.00