- HRC prices continue to slide
- Enquiries, sales remain low post holidays, bargaining continues
- Participants await mills’ price announcement for September sales
Trade-level prices of hot-rolled coils have marginally dropped by about INR 600/t ($8/t) compared to the previous week in the Mumbai market. Prices continue edging down in key markets on harder bargaining by end-buyers despite supply side constraints.
It is also being anticipated that steel majors are to announce their September list prices in the next few days. Hence, most of the market participants have moved to the sidelines, keeping the market activities low alongside the festivites.
SteelMint’s weekly benchmark price assessment for HRC (IS2062, 2.5-8mm) stands at INR 55,500-56,500/t ($698-710/t) while that of CRC (IS513 Gr O, 0.9mm) at INR 66,000-67,000/t ($830-842/t), down by INR 500/t ($6/t). Prices mentioned are on an exy-Mumbai basis, excluding GST at 18%.
Factors impacting prices-
a) Slow sales post holidays: The sales activities in the retail market saw an improvement in the early days of August. By mid-month, the activities slowed down amid festive holidays and since then have remained slow, informed reliable sources. Reduction in prices over the past few months has boosted demand a bit. Buyers are procuring as per their need and bargaining continues unabated. This has kept prices on the downward track, despite the supply constraints seen in the past couple of months.
b) Volatile global HRC market: Indian HRC market has been closely following the global HRC movement for quite sometime now. Even as the domestic trade activities in India improved a bit in August, volatility in the global HRC trade platform and recent drop in HRC export offers have made buyers more cautious. Moreover, a few mills were seen holding back offers recently realising that domestic prices were still better than the global prices.
SteelMint’s Indian HRC export index remained pegged at $583/t FOB for the fourth consecutive week. On the other hand, Chinese HRC (SS400) offers have dropped from $605/t FOB in early-August to $590/t FOB towards the end. A point to note is Chinese export offers could not sustain the increased levels of $620/t FOB seen in mid-August amid rising competition and low buying interest.
c) Supplies to improve in September: The disruption in supplies in the July-August period is likely to ease now as mills are mostly done with their maintenance works. Meanwhile, limited inventory for some products is arresting the steeper declines in prices.
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