Local Indian hot rolled coil (HRC) trade prices have showed no change over the past week amid near stagnant market conditions with buyers not interested in committing fresh bookings as current high prices have not been commensurate with the demand situation in key manufacturing sectors, SteelOrbis learned from trade and industry circles on Monday, March 13.
Indian HRC trade prices have been maintained at INR 60,700/mt ($740/mt) ex-Mumbai and have also remained unchanged at INR 60,200/mt ($734/mt) ex-Chennai in the south.
According to a Mumbai-based distributor, while market intermediaries are almost fully stocked up and have been in no rush to commit fresh bookings, industrial users have been adopting need-based purchases of raw materials as the overall demand forecast remains bearish as the fiscal year nears its end.
Citing data that showed India’s factory output up 5.2 percent year on year in January, he said that the apparent positive is largely negated by data which showed continued inflationary pressures and that the rising interest rate regime will be prolonged, prompting industries to conserve cash, managing with low inventories being one common measure across sectors.
However, producers have been maintaining a more optimistic outlook despite the slowdown of stock movement from mills to the market. “Finished steel prices will remain volatile in the medium term. But the bias will remain upwards, considering the pressures on the cost of production of mills, and steel companies are constantly monitoring market conditions, and base price increases will continue to remain an option on the table,” a source at an Indian mill said.
According to an official at a private mill, taking into account that average capacity utilization of mills is above 90 percent and continued strong overseas sales, flat product prices still have headroom to rise by at least INR 1,000/mt ($12/mt), but the official declined to comment on whether the next price hike would be effected before the current fiscal year closes on March 31.
$1 = INR 82.00
