During the past week the Indian flat steel market continued the upward trend seen in previous weeks, but at a slower pace as compared to the steep price hikes observed in the first half of January.
Currently, domestic hot rolled coil (HRC) offers of Indian steelmakers are standing in the price range of INR 35,500-36,500/mt ($778-800/mt), while spot HRC prices are INR 1,000-1,500/mt ($22-33/mt) higher than this price range. In the Indian flat steel spot market, Chinese origin HRC offers are at INR 37,000-38,000/mt ($811-833/mt). However, in the local market flat steel offers vary depending on the region and delivery terms.
Risk of long lead times prompt Indian buyers to hesitate over import offers
On the import side, the Indian market has witnessed a variety of flat steel offers from China, Europe, Russia and from Asian countries. Chinese SS400 3-12 mm hot rolled coil (HRC) offers to India stand at $780/mt CFR Mumbai for March shipments; however, it would be difficult to say that Indian buyers find these offers attractive. Meanwhile, ex-stock HRC offers via Chinese traders are currently standing in the price range of $750-760/mt CFR. SteelOrbis has heard from market sources that a hot rolled coil (HRC) transaction from Vietnam to India has been concluded this week at $745/mt CFR Mumbai. Nevertheless, the mainstream HRC import offers to the Indian market are at the level of $750-760/mt CFR. Looking at the current situation in the Indian flat steel import market, there are big fluctuations and import offers vary in terms of price ranges. Meanwhile, flat steel import offers to the Indian market generally fail to be converted into actual transactions. Thus, the current flat steel offers from China, Europe and Asia can be interpreted as intended to test the market situation in India. The main factor causing Indian buyers to hesitate to conclude import bookings is the length of the lead times involved. Despite the current upward trend in flat steel prices, taking into account that new import orders can only be delivered at the start of May at the earliest, for the time being Indian flat steel buyers prefer to delay their bookings of import materials, amid the uncertainty over the future price trends.
Indian flat steel demand to strengthen in mid-Q1
Generally speaking, flat steel demand has recovered slightly in India. Market players are confident that demand will strengthen in the coming weeks, and especially in the middle of the first quarter of this year. On the other hand, Indian steel producers are expected to increase their flat steel prices in their new offers in February.
$1 = INR 45.635