Local Indian cold rolled coil (CRC) prices have remained stable during the past week amid the withdrawal of discounts offered in the market following improved bookings from large industrial users, SteelOrbis learned from trade and industry circles on Monday, April 8.
Sources said that benchmark 0.9 mm CRC trade prices are stable at INR 61,200/mt ($735/mt) ex-Mumbai and are unchanged at INR 62,250/mt ($747/mt) ex-Chennai in the south.
According to sources, while the base price of some Indian mills has been heard at INR 58,500 /mt ($702/mt), the trade price from distributors is now higher by around INR 2,700/mt ($32) as distributors over the past week withdrew all discounted sales. Hence, current trade or distributor prices have moved at a premium to the prices charged by mills. Besides, trade channels were heard to be pulling back discounts after automobile companies reported higher levels of new bookings. Although it was not confirmed, there has been a lot of market chatter about at least two large western India-based re-rollers successfully concluding long-term (three month) supply contracts, but no information was available on the negotiated supply price.
“The stability in this segment of flat products and the withdrawal of discounts are a positive. But we do not see much upside potential either going forward. Restocking by industrials are largely because of the start of the current fiscal year. Its continuance remains doubtful as demand projections for entire manufacturing in the current quarter is bearish,” a Mumbai-based distributor told SteelOrbis.
“It might be noted that CRC consumers, barring automobile manufacturers, are not able to pass on the higher cost of their finished products to the market. This will continue to impede their ability to continue with aggressive restocking,” he added.
$1 = INR 83.30