Local Indian hot rolled coil (HRC) trade prices have showed only marginal changes over the past week after mills announced nominal base price hikes, indicating that weak demand continues to weigh on market conditions.
Sources said that HRC trade prices are up INR 500/mt ($6/mt) to INR 49,500/mt ($561/mt) ex-Mumbai and up INR 400/mt ($5/mt) to INR 51,400/mt ($582/mt) ex-Chennai in the south. It was pointed out that large mills announced very conservative increases in base prices for September, but even the lower-than-expected hikes have failed to improve trade volumes, which limited any sharp upward movement in trade-level prices.
At the same time, most market insiders believe that upside potential from the small price increases was largely offset by weak demand from industrial users, which was prolonged by heavy rains and logistical disruptions from floods in several regions across the country. “There is a lot of pessimistic outlooks among market participants and industrial users, resulting in very thin trade volumes. We expect prices to move sideways amid small-volume trades,” a Mumbai-based distributor told SteelOrbis.
“It is a matter of concern for sellers that despite a 31 percent decline in imports in August, the easing of import competition was not proving to be a sufficient driver of local prices, indicating that the fundamental demand weakness will continue to dominate the market,” he added.
$1 = INR 88.24
