Local Indian hot rolled coil (HRC) trade prices have inched up slightly in some offers and, even though trade activity has continued to remain muted, trade channels are expected to quote higher prices in the coming week leveraging sentiments of supplies tightening as mills go in for maintenance shutdowns, SteelOrbis learned from trade and industry circles on Monday, May 6.
Sources said that HRC trade prices are up INR 500/mt ($6/mt) to INR 53,000/mt ($630/mt) ex-Mumbai and are at INR 54,000/mt ($646/mt) ex-Chennai in the south, the same as last week.
“At least three large mills have announced maintenance shutdowns in May and June. We don’t know for sure whether this will result in a tightening of supplies. But it is definitely playing on market sentiments and market intermediaries will starting quoting a higher price going forward, even though there is no evidence of stock movement improving,” a Mumbai-based distributor told SteelOrbis.
“While it’s not definitive, several steel sector analysts are predicting that an estimated 300,000 mt of HRC may be the extent of the shortfall following mill shutdowns. Even if the figure is a guess estimate, distributors will attempt to push up prices but will be resisted in the market in the absence of any demand support,” he added.
At least two officials at large mills not going in for shutdowns said that they were assessing the options of effecting base price increases once there is some more clarity on how the supply side emerges in the coming week.
$1 = INR 83.50