Stability is witnessed in global market as imported offers from China remain unchanged in 3rd week whereas, domestic offers fell by INR 500/MT W-o-W.
Current offers for 2.5 mm HRC (grade SS400) from China have remained stable at USD 270-275/MT, CNF India for the 3rd week as Chinese mills are reluctant to reduce their prices amid mounting losses.
Korea/Japan has followed suit and kept HRC offers unaltered at USD 315/MT, CNF India.
“Prices have been stable since last 2-3 weeks. However, it is hard to predict how long it will continue in global market as Christmas holidays are approaching near in western countries and market is likely to move slowly this month; in turn pressurizing prices”, quoted an importer based in Mumbai.
Prices plunge in domestic market
Unlike stability in global market, HRC prices in Indian market registered a fall of INR 500/MT this week; the reason being sluggish domestic demand. The landed cost of imports from China is lower than domestic prices by INR 2,000-2,500/MT, even after imposition of safeguard duty in Sept’15.
Current offers for 2.5 mm HRC (grade IS2062) are assessed at INR 30,500-31,000/MT (ex-Mumbai), INR 31,500/MT (ex-Delhi) and INR 31,500/MT (ex-Chennai). All prices include 12.5% excise.
“HRC prices in domestic market are likely to fall further by INR 800-1,000/MT till December end”, quoted an official of SAIL.
The shutdown of SAIL’s Bokaro plant, which was scheduled for 45 days and then extended to to 75 days, has led to piling up of semi finish inventory by 700,000 MT to 1.6 MnT. Thus, glut of finish flat steel products by SAIL is likely to arrive in coming months, which is again going to pressurize domestic prices.
In order to compete with cheap offers from China and Korea/Japan in global market, JSW reduced its export offers by USD 15/MT and is now offering material at USD 315/MT, FoB India.
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