Hot-rolled coil (HRC) and cold rolled coil (CRC) prices in India continued to decline further across regions following the price adjustments for May month sales announced by mills a few days back. Slow trade momentum continued to weigh on both HRC and CRC prices this week.
A major steel mill announced HRC list prices at around INR 76,000-76,500/t ($994-1,001/t) for early-May sales, which was INR 79,000-80,000/t ($1,033-1,046/t) for early April sales. Meanwhile, list prices of CRC stand at around INR 83,500-84,500/t ($1092-1,105/t) for May month sales. Prices mentioned are on an exy Mumbai basis, and exclusive of GST @ 18%.
SteelMint’s benchmark price assessment for HRC stood at INR 72,000-73,000/t ($942-954/t), down INR 1,200/t ($16/t) w-o-w, while CRC prices fell by INR 900/t ($12/t) to INR 82,000-83,000/t ($1,072-1,085/t) w-o-w. Prices are basic excluding GST at 18% on exy Mumbai basis.
Domestic prices impacted by following factors:
1. Volatility in coking coal price: The imported coking coal prices have remained highly volatile since the prices stated plumetting in mid-March. The price of Australian origin premium hard coking coal (HCC) which were assessed around $476/t CNF Paradip on 25 Apr’22 moved up to $556/t CNF by 28 Apr’22 before dropping again to $543/t CNF as assessed on 5 May’22. Also, on an average monthly basis the offers in April dropped to $505/t CNF contrasted against $617/t CNF a month back.
2. Continual decline in HRC export offers: The Indian HRC (SAE1006) export index has been on a continual drop from the peak of $1065/t FOB east coast assessed towards end of March. The current weekly assessment shows a further drop of $10/t to $910/t FOB. Meanwhile, there was no major activity seen amid week-long Eid holidays in the Middle East countries in the past few days. Last heard HRC (SAE1006) export offer to UAE was around $950-980/t CFR. Meanwhile Indian HRC (S275) offers to Europe declined to $1,100-1,140/t CFR as against $1,130-1,140/t CFR a week ago. These factors also weighed on the domestic market sentiments.
3. Trades continue to remain sluggish: The end-user industrial buyers are still sticking to the need-based procurement at the current price levels. Furthermore, distribution network participants have been offering HRCs at reduced levels to entice buyers and boost sales even when the trade market prices are lower as compared to the mills’ list prices.
Near-term outlook:
Prices are likely to remain adjusted in the near term amidst slow trade market activities. However, mills remain concerned about the cost push because of higher power tariffs and outages.
Leave a Reply