Domestic HRC prices in India’s trade segment have hit six months low this week as similar price levels were last seen in the month at the beginning of Dec’19. Limited trades in domestic market, improved supplies and liquidity issues are some of the key reasons which have continued to weigh down price sentiments.
Current HRC & CRC prices of major markets –
SteelMint’s assessment for HRC (IS 2062, 2.5 – 8mm) for trade segment stands at INR 35,500-36,000/t (ex- Mumbai), INR 35,800-36,500/t (ex-Delhi), and INR 37,500-38,000/t (ex-Chennai).
Meanwhile, CRC (0.9 mm IS513 GR) prices are assessed at INR 41,000-42,000/t (ex- Mumbai), INR 41,500-42,500/t (ex- Chennai) and INR 40,300- 41,800/t (ex-Delhi). The prices mentioned above are basic, and extra GST @18% is applicable.
Factors behind decline in prices:
1. Labour shortage in factories and warehouses which creates hurdles in the smooth functioning of trades and business activities
2.Few end users have held their orders and few of them have canceled due to which buying activity remaining sluggish
3.Trades are happening mostly in cash payments and credit payments have reduced.This has led to a drop in buying activity since small and medium level traders were mostly doing payments in credit.
4.Seasonal slowdown expected with onset of monsoons
“Domestic market continues to remain flat this week. Active trades are not happening in the market. Only 30-35% of trades are happening in HRC and only 20% of trades in CRC, shared by a major Mumbai based HRC distributor.
Outlook : Traders & stockists are expecting market sentiments to remain gloomy in the near term, considering mills ramping up their output on one side and on the other side slow down in sales.
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