Local Indian trade hot rolled coil (HRC) prices have continued to record gains as more mills taking an early cue from state-run Steel Authority of India Limited (SAIL) are expected to increase base prices over the course of the current week, but fresh bookings by trade channels have remained muted in response to the slowdown in manufacturing activities, SteelOrbis learned from trade and industry circles on Monday, January 2.
Indian HRC trade prices have moved up INR 800/mt ($10/mt) to INR 54,500/mt ($659/mt) ex-Mumbai and up INR 1,000/mt ($12/mt) to INR 54,200/mt ($655/mt) ex-Chennai in the south.
Sources pointed out that, while SAIL has taken an early lead in announcing an increase in its HRC base price by around INR 500/mt ($6/mt) across flat product categories, other mills will announce January price increases on the resumption of business activities after the New Year holidays this week.
“The increase in prices is showing a mixed response across regional markets. Major trade hubs of Mumbai and Delhi reported a drop in bookings by traders, who are either fully stocked up or cautious amid reports of a further slowdown in manufacturing sector growths,” a Mumbai-based distributor said.
“Producers are pushing for higher domestic base prices largely on improved overseas sales. But without commensurate improvements in domestic demand, such price increases risk further declines in local trading,” he said.
At least two observers in trade circles said that, since most mills will increase base prices at the same level as set by SAIL, which was lower than expected, producers are most likely to go in for another round of hikes at the end of January, taking the aggregate increase in the month to around INR 1,000/mt ($12/mt).
$1 = INR 82.70