This week domestic HR-plate prices slumped further on reduced buying interest from traders who are postponing their purchases hoping for a further slide in prices.
Currently, SteelMint’s benchmark assessment for the HR-plate (IS 2062 5-10mm) stands at INR 54,000-55,000/t exy-Mumbai, down by INR 750/t w-o-w. Price is exclusive of GST @ 18%.
“Demand remained slow majorly form the construction, OEM and project sectors,” a major plate producer shared with SteelMint.
Factors behind the decline in price-
1. OEMs delayed their purchases- With the soaring domestic prices, OEMs have held back from placing orders for higher quantities. For critical projects, the manufacturers have aligned their procurement to project requirements while deferring procurement for other non-critical projects.
2. Decline in global prices- The end-users have grown more observant of the market as global prices continued to decline during the past few weeks. The current week offers for Chinese heavy-plate (SS400, 5-10mm) stands at 630-640/t FoB China similar to the range of $610-655/t FoB basis prevalent towards the end of Dec ’20. The decline comes on the back of a seasonally weak demand over chilly winters and upcoming Chinese Lunar New Year holidays starting from 11 Feb.
3. Limited inquiries from trade segment- Traders are reluctant to make fresh inquiries and are waiting for clear indication on prices after the announcement by major mills. They are not planning to restock on expectations of prices sliding down further.
What may happen?
Market participants shared with SteelMint that the plate prices are under pressure, but at the moment mills are holding on to the prices. Although plate demand is very less, the mills feel that this is a temporary phase. However, after the announcement by major steel mills, plate prices are expected to rebound.
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