India: Trade-level HRC offers surge by up to INR 1,700/t w-o-w following safeguard duty recommendation

• Market buzzing with rumours of mill price hikes in coming week
• BigMint’s HRC export index remains unchanged w-o-w

Trade-level HRC offers surged by up to INR 1,700/t w-o-w to reach INR 49,400-52500/t across domestic markets. Cold-rolled coil (CRC) prices increased by up to INR 1,000/t w-o-w, settling at INR 55,000-58,800/t following recommendation of a 12% safeguard duty on flat steel imports for a period of 200 days.

BigMint’s benchmark assessment (bi-weekly) for HRCs (IS2062, Gr E250, 2.5-8 mm/CTL) increased by INR 1,700 /t w-o-w to INR 51,500/t on 21 March. Also, CRC (IS513, Gr O, 0.9 mm/CTL) prices increased by INR 600/t w-o-w to INR 57,600/t. These prices are quoted ex-Mumbai for the distributor-to-dealer segment and exclude 18% GST.

Market updates

Market surges after safeguard duty proposal: HRC prices experienced a significant surge across most regions of India, driven by the anticipation of an impending safeguard duty. Additionally, market sentiment was influenced by reports suggesting that mills are planning to raise their list prices by INR 1,000-1,500/t in the coming week, accompanied by a reduction in price support measures. Further, mills are expected to implement an additional increase in next month’s list prices, ranging from INR 1,500-2,000/t

“The market is witnessing a sharp increase in prices driven by the proposed safeguard duty. In response, buyers have adopted a cautious wait-and-watch approach, showing reluctance in commiting to higher prices amid uncertainty over further price movements.,” said a market participant.

MSMEs and other buyers are expressing concerns over the increasing cost of raw materials. This upward trend is projected to directly inflate their production costs, thereby diminishing their capacity to compete effectively in the market.

Import trends: India’s bulk imports of HRCs and plates touched 2,00,685 t on 17 March, according to vessel line-up data with BigMint. An additional 35,344 t are expected to arrive by the end of this month.

Export trends: BigMint’s India hot-rolled coil (HRC, SAE1006) export index, for the Middle East and Vietnam, registered no change w-o-w, maintaining a level of $495/t FOB. The absence of active Indian offers to the Middle East was attributed to the price competitiveness of Chinese suppliers and a general deceleration in market activity. However, Indian HRC suppliers re-engaged with the European Union (EU) after India secured an exemption from the provisional anti-dumping duties levied by the European Commission (EC). In Vietnam, a preference for domestically sourced HRC was observed among buyers, despite the trend of increasing mill prices.

Outlook

Prices are expected to remain range-bound for the rest of the month, as the market awaits clarity on potential mill price hikes and a recovery in demand.