Local Indian hot rolled coil (HRC) trade prices have moved on a firm uptrend amid strong restocking by trade channels and end-users reacting to mills’ mid-term base price increases, reversing the prolonged trend of price cuts, SteelOrbis learned from trade and industry circles on Monday, September 19.
Indian HRC trade prices have surged INR 900/mt ($11/mt) to INR 56,100/mt ($703/mt) ex-Mumbai and are up INR 1,000/mt ($13/mt) to INR 56,500/mt ($708/mt) ex-Chennai in the south, becoming almost on a par with base prices of mills, in sharp contrast to the large discounts of trade prices to base prices seen since April this year.
According to sources, having ended base price cuts over the past several months, mills “tested” the market by rolling back such cuts and effected a mid-month modest price increase, and there were lot of indications in the market that producers would become more aggressive in hiking prices further during the October-December period.
“The market has absorbed higher prices, which will support producers’ efforts to continue to seek higher prices during the traditional strong demand season ahead. Prices have clearly touched a bottom and now have strong upside potential,” a Mumbai-based distributor said.
“Our assessment is that HRC base prices have the potential to gain another INR 2,000/mt ($26/mt). The increase may not be effected at once but phased in over the next two months. Buyers across market participants are therefore reporting higher-volume bookings,” he said.
One official at a private mill said that the mill was holding back export offers amid strong realizations from domestic sales and the faster movement of stocks in the local market.
$1 = INR 79.80
