Indian local hot rolled coil (HRC) trade prices have showed minor variations amid extreme low trading activity owing to the spate of festivals, fiscal year-end considerations and trade channels preferring to defer new bookings and conserve liquidity, SteelOrbis learned from trade and industry circles on Monday, March 27.
While Indian HRC trade prices have remained stable at INR 60,000/mt ($727/mt) ex-Mumbai, they lost a marginal INR 200/mt ($2/mt) at INR 59,000/mt ($715/mt) ex-Chennai in the south.
“Since early this month, there has been a spate of festivals and there are two more ahead and the holidays are dampening trade activity,” a Mumbai-based distributor said.
“The most important hit being taken by market intermediaries is from rising interest rates and hence the higher cost of borrowed funds from banks. The high cost of funds is forcing dealers to cut back on inventories in a market where stocks are in any case moving slowly. The mood is getting bearish every day,” he said.
However, producers have held a more optimistic outlook with at least two officials at private mills confirming that an increase in base prices for April is already under discussion.
“There may be some volatility in global steel prices with demand in China weakening. But the Indian demand situation remains strong and will grow at a high single-digit in the next fiscal year. Producers will have to be cautious in protecting margins in volatile global markets underpinned by strong local demand,” one official at a producer said.
“We will definitely explore all avenues to increase April base prices on the back of the rise in iron ore and coking coal prices. Once book reconciliation pressures are over, we are positive of a rebound in price and trade volumes in April,” he said.
$1 = INR 82.50
