India: Galvanised plain coil trade prices edging closer to Apr'21 levels

Trade-segment prices of galvanised plain (GP) coils remained range-bound this week, although these have been edging close to the levels of INR 70,500/t assessed in early April 2021.

SteelMint's weekly assessment of galvanised plain coils (GP) of thickness 0.5mm, 120gsm, stood at INR 71,000-72,000/t, down by $300/t. On the other hand, pre-painted galvanised iron (PPGI) (0.5mm, 90gsm) prices continued to hover around INR 78,000-79,000/t. Prices are on exy-Mumbai basis, excluding GST @ 18%.

Also, on a monthly average basis, prices of GP (0.8mm, 120gsm) have shown a sharp drop of INR 11,400/t from INR 83,700/t in May 2022 to INR 72,300/t in June, as per data maintained with SteelMint.

Mills cut prices for GP for early-July sales
Earlier this month, steel major AM/NS India had reduced its GP prices for early-July sales. Subsequent to the revision, the price of GP (0.8mm, 80gsm) stood at around INR 71,000/t which was INR 75,000/t for early-June sales. A slowdown in trade and a continual decline in prices in June led to price cuts by the manufacturer.

HDGI export offers drop steeply post-export duty announcement
Mills continue to find it difficult to conclude deals in the overseas markets as an export duty of 15% was levied on non-alloyed clad or plated flat steel products in May 2022. The offers have since then dropped by about $160/t. In the current week, export offers for hot-dipped galvanised iron (HDGI) coils (0.50mm, 900-1,250mm) were assessed at $1,000/t FOB west coast contrasted against $1,160/t FOB on 19 May, a few days before the duty announcement. Last week's offer was assessed at around $1,025/t FOB.

Continual decline in HRC, CRC prices
The trade-level prices of hot rolled coils (HRCs) and cold rolled coils (CRCs) have been sliding down since early April. The current week's assessed prices of HRCs (IS2062, 2.5-8mm) stand at around INR 59,800/t, steeply down from INR 78,800/t on 6 April, as per SteelMint records. Similarly, the current week's prices of CRCs (IS 513 Gr O, 0.9mm) are assessed at around INR 68,000/t against INR 89,000/t on 6 April.

This also has a bearing on the price trend of the value-added coated steel products.

Wary buyers continue procuring as per need
Apart from the seasonal disruptions that monsoon rains bring, the buyers are still concerned about the price direction. "Major steel mills have been trying to adjust to the demand by opting for maintenance shutdowns ahead of their normal schedules, but that has not done much to improve the buying interest. Buyers still continue to procure in small packages and refrain from booking in bulk volumes to avoid losses," said a major distributor from western India.

Moreover, subdued activities from infrastructure and construction businesses owing to the monsoons are likely to weigh on the steel demand from segments such as pre-engineered buildings, etc. However, small improvements are being seen from the fabrication and other small and medium-sized businesses, SteelMint learned from market sources.