India’s HRC/plates import volumes have touched the six year’s low market and aggregated to 1.22 mn t in CY ’20, as per the data maintained with SteelMint. According to records imports volume was at 1.71 mn t in CY ’14.
Also on a yearly basis the import volumes have been slashed by 47% in comparison with 2.31 mn t in CY ‘19.
Factors affecting the imports:
1.Disruption in market activities-
The stringent lockdown in India from Apr ’20 until Jun ’20 weighed heavily on the domestic market activities restricting the movement of both human and goods. Furthermore, domestic trades were hindered by on-and-off lockdowns after the Unlock Phase announcement in late Jul ‘20, while the overseas trades continued to remain disrupted due to an increasing number of cases in other exporting nations.
2.Rising global HRC prices-
The global HRC/plate prices started their continual ascent since Apr ’20 with the gradual reopening of the Chinese market. The prices for HRC started the continual uptrend and other major exporting followed the suit and started offering at elevated levels.
3.Increasing demand in exporting nations-
The steel producers in major exporting countries viz South Korea and Japan cut on their export volumes with an increase in their domestic market consumption as their economy started to recover from the pandemic’s blow in the second half of CY ’20.
4.Landed cost of imports were higher than domestic prices-
Since Jul’20 landed cost is higher than domestic prices as per the calculation shown in the table below. Thus higher cost of imports resulted in lower bookings this year.
Country-wise imports-
Imports from South Korea dipped by 38% to 0.93 mn t in CY ’20 as against 1.50 mn t in CY ’19. Further imports from Japan slumped by 76% y-o-y to 0.10 mn t and in addition import volumes from Indonesia fell by 69% to 0.05 mn t in CY ’20.
Port-wise imports-
The major ports in CY’20 were Mumbai at 0.6 mn t in Dec ’20 down by 50% as against 0.09 mn t CPLY. Other importing ports were Mundra at 0.4 mn t remained same as previous year, Chennai at 0.03 mn t (up 67%) in Dec ’20.
Outlook– Indian HRC imports is expected to remain low on higher global prices. Also landed cost of imports are higher than domestic prices. Thus it will be not viable for importer to procure HRC from major exporting nations
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