The upturn in the local Indian cold rolled coil (CRC) market has been reversed during the past week amid the resolution of supply-side fears and end user industries starting to re-strategizing their production planning in view of the new wave of the pandemic and the imposition of regional restrictions forcing them to review raw material restocking, SteelOrbis has learned from trade and industry circles on Monday, March 22.
The sources said that resolution of protests that had hit leading CRC producer POSCO Maharashtra Steel Limited over the past week has dispelled fears of supply-chain disruptions that had triggered price increases.
At the same time, the pandemic rising in key industrial regions in Maharashtra in the west and Punjab-Haryana in the north has impacted sentiments among major industries, which have become cautious about making fresh bookings, uncertain of how the new restrictions imposed by local authorities will impact manufacturers having multiple plants across a wide geographical range.
Sources said that integrated steel mills and standalone re-rollers have maintained base prices at around INR 58,500-59,000/mt ($807-814/mt) ex-works, but tradable prices have softened to around INR 60,000/mt ($828/mt) ex-Mumbai, compared to INR 61,000-62,000/mt ($841-855/mt) ex-Mumbai a week ago.
“The market is very fluid and can move in either direction depending on how the impact of the next wave of the pandemic pans out. The strategy of tackling it will be local in contrast to the national lockdown last year, while the impact on manufacturing too will be different sector to sector, region to region. Producers will tend to keep base prices stable and resort to differing pricing strategies depending on the localized demand situation. One pricing strategy will not fit all regions,” an official at ArcelorMittal Nippon Steel (AMNS) said.
“I see the market getting fragmented going forward and sellers will have to increasingly be more customer-centric in their pricing to push volumes in the market,” he added.
$1 = INR 72.50
