Domestic HR-plates prices have spiked by INR 2,900/tonne (t) ($39/t) this week on the back of active restocking at the trade level.
For week 41 (4-9 Oct’21), SteelMint’s assessment for HR plates (IS 2062/E250, 5-10mm) stood at INR 68,000-69,000/t ($908-923/t) exy-Mumbai contrasted against INR 65,500-66,500/t ($875-888/t) exy-Mumbai a week back. Prices are basic, excluding GST at 18%.
Factors that lifted market sentiments:
1. Anticipation of price hike by mills: In the middle of the previous week, the market picked up as most trade channel participants rushed out to restock amid fear of an increase in prices for Oct’21 dispatches.
“Most of the trade participants were sitting on a lean inventory amid low demand, and all came out to restock which led to a hike in trade activity as well as prices,” said a western India-based distributor.
2. Supply shortage in the offing? : There has been some chatter in the market that supplies have fallen short of demand in the past few days. “Distribution activities slowed down by mid-week as supplies fell short of what the market was asking for,” informed another distributor from northern India.
3. Mills’ prices heard to be on the higher side: Major HR-plate producers are offering at higher price levels. PSU major SAIL is heard to have increased plates prices by INR 3,000/t and quoting at INR 67,500-68,000/t exy-Mumbai whereas JSPL, a private producer, is quoting higher at INR 69,000-69,500/t exy-Mumbai basis.
What lies ahead?
Major manufacturers are looking forward to a price hike amid rising production costs and the recent power supply concerns may be an added factor.
Demand might come from:
1. Green energy sectors: The governments’ push for increasing clean energy sources has led to various incentives and investments in the renewable energy segment, which might continue to support demand. Also, the wind tower segment has remained in focus for quite some time, fuelling prospects of plates requirements.
2. Heavy and light commercial vehicle segment: The revival in major infrastructure and mining activities is anticipated to boost sales of heavy earth-moving vehicles. Along with this, intermediate and light commercial vehicle sales may also rise with the onset of the festive season.
Leave a Reply