Local Indian hot rolled coil (HRC) trade-level prices have showed a mixed trend over the past week amid a dip in trade volumes as buyers have showed signs of becoming more cautious in restocking at prices which are almost at a two-year high, while awaiting new base price signals from large mills for the current month, SteelOrbis learned from trade and industry circles on Monday, March 2.
Sources said that, while trade-level HRC prices have remained stable at INR 52,000/mt ($571/mt) ex-Mumbai, they are down INR 500/mt ($5/mt) to INR 54,500/mt ($598/mt) ex-Chennai in the south.
According to the sources, sentiments in the market have started to move toward greater caution, with current trade-level prices moving close to an almost two-year high, and distributors are unwilling to aggressively restock, with no material change in demand foreseen ahead.
At the same time, market participants including intermediaries have been deferring bookings awaiting new base price signals from mills. There have been considerable divergent expectations on this front, with a section of the market maintaining that mills could be expected to be much more conservative in aggressively hiking base prices, seeing buyers’ resistance mounting in the market.
“The recent gains in trade prices, pushing them to a recent high, were fuelled by supply-side tightening and the aggressive pricing of producers. Without a matching demand improvement, this is now running out of steam. Whether this will trigger a big correction is difficult to forecast, but trade activity will remain on the lower side,” a Mumbai-based distributor told SteelOrbis.
$1 = INR 91.05
