Major Indian steel producers have announced their list prices for hot-rolled plates (HR-plates) for early-May sales. AM/NS India’s HR-plate (5-10mm, E250) list price stands at INR 86,000/t ($1,119/t)*, while those of SAIL are at INR 76,000-77,000/t ($989-1,002/t). It is heard that JSPL is offering PM plates (20-40mm, E250) at INR 86,000/t ($1,119/t). Prices are on an exy-Mumbai basis, exclusive of GST @ 18%.
Factors weighing on HR plate prices
1. Trade market prices hold for second consecutive week: SteelMint’s assessment for HR-plates (E250, 5-10mm) has continued to hover around INR 72,000-73,000t ($937-950/t) exy-Mumbai for the past two weeks. Prices are basic, excluding GST at 18%. Moreover, prices dropped from the highs of INR 78,000-79,000/t ($1,015-1,027/t) exy-Mumbai at the beginning of April. This was majorly because of the buyers holding back from making bulk purchases amid steeply high prices.
2. Decline in global plate prices: Prices of plates on the global trade platform started weakening since mid-April. For instance, export offers of Chinese heavy plates (SS400), that had risen to $895-905/t FOB in early April, registered a steep drop to $860-875/t FOB, as per the current week’s assessment. Logistical hurdles due to the Russia-Ukraine geo-political tensions and stringent lockdown in the previous month weighed on both offers and buying sentiments on the global trade platform.
3. Slow end-user industrial activities weigh on demand: The slow momentum of activities from end-user segments in the past few months have weighed on procurement volumes from the infrastructure and residential segments. Moreover, there had been a few protests last month by the consortium of developers/contractors against the steeply rising prices of steel and other materials in the northern region of India. These also had kept the demand momentum slow during the month for the allied industries like original equipment manufacturers (OEMs) and heavy engineering as well. For instance, the India Manufacturing Purchasing Manager’s Index (PMI) moved up to 54.7 in April against 54 in the preceding month, indicating a subdued growth in contrast with 57.6 in November 2021.
The major factors weighing on the indices are the input price inflations which are at 5-month highs and the output prices, which have risen the most in the past 12 months.
Near-term outlook
The market sentiments remain mixed at present, with a section of participants opining that demand will witness an uptick ahead of the monsoons, while others raise concerns that prices need some more normalisation. Thus, the prices are more likely to move in a narrow range in the near term.
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