Local India hot rolled coil (HRC) trade prices have remained under pressure from low buying interest and import pressures and have edged lower amid discounted sales by distributors in some regions, SteelOrbis learned from trade and industry circles on Monday, December 16.
After a slight increase a week ago, HRC trade prices have lost INR 200/mt ($2/mt) coming to INR 48,800/mt ($575/mt) ex-Mumbai and are also down INR 200/mt ($2/mt) to INR 50,300/mt ($593/mt) ex-Chennai in the south.
According to sources, some distributors in trading hubs around Mumbai were heard to be continuing to confirm bookings at INR 47,100/mt ($555/mt) net of discounts, also INR 200/mt below discounted deals a week ago.
They said that import shipments have been continuing to put pressure on the price and accentuating the glut in the market without any commensurate uptick in demand.
As per trade circle information, inward shipments of imports up to December 13 were estimated at 55,000 mt this month and as per vessel arrival schedule another 190,000 mt are expected to land at Indian ports by the end of December.
“The sustained downtrend in prices is having a severe impact on the financial fundamentals of both producers and market intermediaries. In case of producers, the low realisations are beginning to put existing operations and future capital expenditures under severe risks. As for market intermediaries, the high level of inventories has resulted in lot of funds being locked up, resulting in a serious liquidity crisis,” a Mumbai-based distributor said.
“Even the much talked about 25 percent safeguard duty, even if imposed, will have an impact with a lag and hence HRC trade will remain under pressure for some more time,” he said.
$1 = INR 84.80