Will Indian Steel Mills Lower HRC Prices in August?

Indian HRC prices continued to remain on lower side over tedious demand and dull buying prevailing in domestic market. Trade sources shared that market sentiments continued to remain lackluster over fewer trades happening in domestic market.

As per SteelMint price assessment trade reference prices for HRC (IS2062,2.5-8mm) is currently at INR 37,500-38,000/MT (Ex-Mumbai), INR 37,000-37,500MT (ex-Delhi) and INR 39,000-40,000/MT(ex-Chennai).Prices mentioned above are basic and extra GST@ 18% will be applicable.

Meanwhile trade reference prices of CRC (0.9mm, IS 513) prices on weekly basis are currently hovering around INR 42,500-43,000/MT (ex-Mumbai), INR 40,500-42,500/MT (ex-Delhi) and INR 43,500-44,500/MT(ex-Chennai). Prices mentioned above are basic and extra GST@ 18% will be applicable.

Market participants are expecting price cut by INR 1,000-1,5000/MT for August. However company officials mentioned that announcement is yet to be made, however reduction will be in terms of offers or discounts which is yet to be announced.

A trader based in Ludhiana commented that,” Slow demand continue to pressurize HRC prices further in domestic market. Also trade segment is expecting discounts and rebates to support current scenario”.

Few other trade sources shared that,”Demand is likely to pick up towards the end of monsoon season in Sep month which may support the prices in near term”.

Auto sales continue to decline in Q1- As per market reports, auto sales reported decline in first quarter of this fiscal against the backdrop of consumer sentiment continuing to remain subdued because of the overall slowdown in the economy and tightening of credit norms by banks.

The situation further worsened as demand in the rural market nosedived because of falling farm income and lack of financing options from NBFCs.

In Q1 FY20, sales of automobiles from showrooms declined by 6% to 5.12 Million units. Retail sales of passenger vehicles declined by just 1%, but commercial vehicle sales fell sharply by 14%.