India: HR plate trade prices fall by up to INR 300/t w-o-w

Trade-level prices of hot-rolled plate-mill (PM) plates (IS2062, Gr E250 Br, 20-40 mm) fell by up to INR 300/t ($4/t) w-o-w. BigMint's weekly assessment of HR plate (IS2062, Gr E250 Br, 20-40 mm) dropped to INR 49,000-52,500/t ($578-619/t) exy-Mumbai on 11 December 2024. Additionally, prices of hot strip mill (HSM) plates (IS2062, Gr E250 Br, 5-10 mm) were rangebound at INR 47,500-49,000/t ($560-578/t) exy-Mumbai. Prices exclude 18% GST.

Market overview

Slow demand hits trade prices: Trade prices remained under pressure due to weak buying interest in the market, with buyers avoiding making bulk procurements. Furthermore, the liquidity status of market participants raises concerns amid the delays in credit recovery.

"Big business houses in the infra-construction, green energy (especially wind power), and heavy engineering sectors are the key buyers of PM Plates. But demand from these has shifted from the trade market to direct procurement from mills, raising concerns around reducing buyer-base for distributors," informed a market participant.

The small and medium participants do not have much liquidity or easy access to finances which has forced them to avoid building up inventories and procure in small parcels to meet urgent requirements, he added.

Supply-demand imbalance: Imbalanced supply-demand has also been exerting pressure on the prices of plates in the traders' market. There is floating news about a major private plate producer holding back from supplying in the traders' market and maintaining high prices amid limited inventory in the market. On the other hand, supplies from a PSU steel major and another private mill are at decent levels. Thus, the traders' market inventory is still high amid a slow demand scenario, BigMint learned from a few reliable industry sources.

Global plate export offers remain stable w-o-w: Chinese heavy plate (SS400) export offers remained stable at $515/t FOB China this week. These offers have been fluctuating in a narrow band of $5/t between $510 and $515/t after dropping from $535/t level on 16 October. However, this has also failed to incite buying interest in both the overseas and the Indian market.

Outlook

Weak-performing coil prices and limited buying interest in the traders' market are likely to keep thicker gauge steel plate prices in check and prices are likely to move in a narrow band.