Local Indian hot rolled coil (HRC) prices have come under renewed pressures as end-users halted bookings due to uncertainties over the September base prices of mills, while trade channels have witnessed a slowdown in activity, SteelOrbis learned from trade and industry circles on Monday, August 29.
Indian HRC trade prices have lost INR 300/mt ($4/mt) to INR 56,700/mt ($710/mt) ex-Mumbai and are down INR 600/mt ($8/mt) to INR 57,000/mt ($713/mt) ex-Chennai in the south.
Trade circles maintained that the downside movement in prices was however checked somewhat as mills have either cut down production or gone into annual maintenance shutdowns, which have tightened the flow of materials from mills to traders.
“Iron ore and imported coking coal prices have started showing signs of firming up. Hence, it is difficult to take a call on the September base prices of mills. While higher input prices would indicate an increase in base prices, it will increase risks at a time when the market is finding a balance at lower levels,” a steel sector analyst at a Mumbai financial services advisory firm said.
“Our own assessment is that producers will weigh in on the side of reducing base prices by around INR 1,000/mt ($13/mt), expecting increased volume sales to compensate for the pressures on margins from higher input costs,” he said.
$1 = INR 79.90
