Indian Flat Products Prices Likely to Increase amid Surging Global Offers

Global export offers for flat products have been increasing since last two months. If M-o-M comparison is done then HRC/CRC prices have surged by more than USD 150-200/MT since Feb’16.

This week, HRC prices from China have once again increased by USD 15-20/MT against previous week. Current offers for 2.5mm HRC are heard at USD 460-480/MT whereas CRC offers are heard at USD 520/MT, FoB China basis.

Along with China, CIS countries have also hiked their export offers and current offers for HRC and CRC are assessed at USD 470-480/MT and USD 520-530/MT, FoB Black Sea. However, no firm offers are being heard from Japan and Korea as the sellers there are in to wait and watch mode amid indiscriminate increase in prices.

Domestic Offers

Following increment in global offers, domestic HR/CR prices have also increased in the range of INR 5,000-6,000MT in last two months.

Current offers for 2.5mm HRC are assessed at INR 35,500-36,000 (ex-Delhi), INR 34,500-35,000/MT (ex-Mumbai) and INR 36,000-36,500/MT (ex-Chennai). All prices include excise of 12.5%.

Offers for 0.9mm CRC are assessed at INR 41,000-41,500/MT (ex-Delhi), INR 40,500-41,000/MT (ex-Mumbai), and INR 41,000/MT (ex-Chennai). Prices include excise of 12.5%.

However, there is strong buzz in the market that prices are likely to increase by INR 1,000-1,500/MT from the manufacturer’s end in latter half of this week.

Although there is muted demand in the domestic market, domestic prices are surging owing to increase in global offers. HRC prices in international market have crossed MIP rate of USD 445/MT and thus domestic manufacturers have scope to raise prices further.

Indian manufacturers have once again resorted to export market because of good sales realizations in the market. The net sales realizations from the export sales is in the range of INR 30,000-30,500/MT which is almost equal to domestic sales realizations.

HRC prices as on 3 May’16

Source: SteelMint Research