Local Indian hot rolled coil (HRC) trade prices have remained stable during the past week but amid widespread reports of sales at discounts amid the negative demand outlook and business uncertainties ahead of the national elections, SteelOrbis learned from trade and industry circles on Monday, March 18.
Sources said that, though HRC trade prices have been stable at INR56,500/mt ($682/mt) ex-Mumbai and INR 57,250/mt($691/mt) ex-Chennai in the south, discounted sales have been widely reported from the western and southern regional markets at as low as INR 52,000/mt ($630/mt), significantly lower than the levels of INR 54,000-55,000 /mt ($652-664/mt) net of discounts a week ago.
“Trade channels are in a very bearish mood. Steel mills are now supporting the poor demand by lowering March base prices. Trade has no alternative but to push sales through discounts to improve cash on books at the fiscal year-end,” a Mumbai-based distributor said.
“The long national elections across the country stretching from April 19 to June 1 will also cause business uncertainties and reduced activity among end-users and trade. We are in for sustained weak market conditions,” he said.
According to an official with a large private integrated mill, export sales have been showing slight signs of a revival and hence there is less pressure to push local sales by dropping base prices. He said that, unless there were “unofficial directives from the government to reduce prices ahead of the national elections”, the mill is largely expected to maintain prices unchanged during the next two to three months at least.
$1 = INR 82.80