Indian Plate Manufacturers anticipate Limited Downside

Indian plate mills cut offers amid competitive prices from global suppliers, however anticipates limited downside from here

Indian plate manufacturers feel pressure from competitive offers from Indonesian steel mills. Current offers for 12-20 mm (IS 2062) MS Prime Plates are assessed at INR 29,500-30,500/MT (USD 465- 480) on ex- factory basis, based on quantity & payment conditions. Offers are down by almost INR 500-1,000/MT since 1 Apr’15.

Market participants claim that cheaper imports from Indonesia is a major threat to Indian manufacturers. Few deals of E-250 grade (equivalent to A36) Plates from Indonesia (POSCO) have been concluded at USD 402-405/MT CIF India levels for June end deliveries and at USD 428/MT for May deliveries.

It may be noted that Indian government has waived off duty on imports from ASEAN countries (w.e.f 1 Jan’15) under Preferential Trade Agreement. Whereas, imports attract a duty of 7.5% from China, 0.8% from Japan and 1.2 % from South Korea.

“There is certainly some pressure in domestic market. Buyers have the option of buying imported Plates from POSCO – Indonesia, which is of the quality equivalent to that approved for government projects. Current offers for MS Plates are at around INR 30,000/MT (ex- works).” said a senior marketing executive at one of the large Plate mills in India.

“Chinese offers are not very competitive at the moment due to higher import duty. Also, the Indian government has recently made BIS registration compulsory and many of Chinese mills do not have such registration”, he further added.

Some Plate Mills prefer Imported Slab

Lower offers of Slabs from Indonesia and Brazil have drawn attention to some Indian Plate mills located in the coastal region. Around 45,000 MT Prime Slab imports have been recorded at Mundra and Kandla port in the month of April 2015 (till 20th) at about USD 365-366/MT CIF India levels.

Non-integrated plate mills in Khopoli (Maharashtra), using imported slabs, are offering MS Plates at INR 28,500-29,000/MT on ex- works basis, excluding excise duty of 12.5%.

All are Non Alloy Prime & defective steel