Weak demand, falling raw material prices and cheap import offers are forcing Indian steel players to lower down their domestic prices.
Post safeguard duty announcement on hot rolled products in September, domestic HRC prices have observed an increase of INR 500-700/MT.
However if market sources are to be believed, HRC/CRC prices have rolled back again. The key reasons being weak demand and declining raw material prices.
“Current demand in India is very weak owing to no new infrastructure projects being initiated by the government”, quoted a market participant based in Delhi.
In addition, prices of raw material such as iron ore, coking coal and scrap have declined by 12%, 2% and 19% respectively within a month.
Current offers for 2.5 mm (IS2062 grade) HRC is being assessed at INR 32,500/MT (ex-Mumbai; -500), INR 33,000/MT (ex-Delhi; -200), INR 33,000/MT (ex-Chennai; 0 ) and INR 33,000/MT (ex-Kolkata; -500). All prices include excise of 12.5%.
Chinese manufacturers further lowered down their export offers; providing stiff competition to domestic players. Chinese steel exports in September increased significantly at 11.3 MnT.
Surge in CRC imports
With safeguard duty not being imposed on CRC, there has been its import influx, which is directly affecting prices in domestic market.
Currently, 0.9 mm CRC offers is being offered at INR 36,500/MT (ex-Mumbai; -300), INR 38,500/MT (ex-Delhi; 0 ), INR 37,500 (ex-Kolkata; -500), and INR 37,000 (ex-Chennai; -500). All prices include excise of 12.5%.
“A bulk CRC order has been booked recently, so it is expected that prices will fall further in coming months”, quoted a CRC dealer based in Mumbai.
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