India: Domestic HRC Trade Prices Remain Under Pressure Over Low Priced Imports

Domestic HRC prices in traders market have come down by INR 500-1000/MT (USD 7-14) against last week and are hovering at almost 4-months low.

This week Indian HRC prices witness significant downturn amid bearish market sentiments along with competitive cost of imports and sluggish demand prevailing in domestic market. On weekly basis domestic HRC prices declined by INR 500-1000/MT in traders market.

Currently HRC (2.5-8mm, IS2062) prices in traders market is around INR 40,000-40,500/MT (ex-Mumbai), INR 40,500/MT (ex-Delhi) and INR 43,000/MT (ex-Chennai). Prices mentioned above are basic and extra GST@ 18% will be applicable.

Currently CRC (0.9mm, IS 513) in traders market is around INR 45,000-45,500/MT(ex-Mumbai), INR 45,000-46,000/MT (ex-Delhi) and INR 47,000-48,000/MT (ex-Chennai). Prices mentioned above are basic and extra GST@ 18% will be applicable.

Indian HRC prices are weakening in traders market due to following reasons:

1. Slow demand and weak buying interest- Market sources reported to SteelMint that buying remained sluggish in domestic market. Increased prices by major steel mills in the beginning of the month by INR 750-1000/MT doesn’t seems to be absorbed in market. Also lacklustre demand from construction and auto sector and arrival of monsoon season will keep domestic HRC prices under pressure in upcoming months.

2. Cheaper HRC imports leads to domestic HRC prices under pressure- Amid global downtrend in prices from major exporting nations like China, Japan and South Korea result to surge in HRC import volumes to India.

HRC offers from Japan and South Korea have declined to India by USD 10-15/MT and are heard at USD 525-535/MT CFR basis. As per calculation landed cost is assessed around 38,500-39,000/MT (landed to Mumbai plant). However domestic HRC prices stands at INR 40,500/MT (Ex-Mumbai).Prices mentioned above are basic and extra GST@18% is applicable.

3. Lower HRC export bookings- Major Indian steel mills have lowered HRC export offers to Vietnam following decline in HRC prices in domestic prices. Currently Indian mills are offering HRC to Vietnam at around USD 500/MT CFR basis. However no major deals concluded yet.