India: Domestic HRC price rally continues on limited supply

Domestic HRC prices increased by INR 500-1000/t w-o-w on tight supply and restocking demand in the domestic market.

Major steel mills have lifted HRC prices twice this month on the back of buoyant domestic and export demand.

A sharp increase in iron ore prices over the past few weeks due to limited supply in Odisha have also supported downstream prices, including HRC.

SteelMint's assessments of HRC and CRC prices-

• HRC (IS 2062, 2.5 - 8mm) prices were at INR 39,000-40,000/t (ex-Mumbai), INR 39500-40,000/t (ex-Delhi) while INR 39,500-40,500/t (ex-Chennai).
  
  
• CRC (0.9 mm IS513 GR) prices were assessed at INR 45,000-45,250/t (ex-Mumbai), INR 44,500-45,000/t (ex-Delhi) and INR 45,500-45,500/t (ex-Chennai).
  
  
• The prices mentioned above do not include 18% GST.
  
  

Reasons driving domestic HRC trade prices

1. Major steel mills announced a second price hike in Aug'20- This week, SAIL , JSW and AMNS India lifted prices by around INR 500-1000/t following a hike of around INR 2,000/t at the beginning of the month.
   
   
2. Limited supply in the domestic market- Traders have started to restock aggressively in anticipation of a further hike in prices this month. On the other hand, mills are unable to supply owing to limited inventories and backlog of export orders. "Auto OEMs have started building up inventories on expectations of a further hike in prices. The market is being majorly driven by panic demand," said a Mumbai-based distributor.
   
   
3. Hike in HRC export offers- Indian steel mills have lifted HRC export offers further on an uptrend in global prices. Currently, steel mills are offering around $520-525/t CFR basis for Sep-end/ early Oct shipments.