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India: Major ERW pipe producer cuts prices for early-Mar'24 sales

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BigMint Bureau

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6 Mar 2024, 18:23 IST

India: Major ERW pipe producer cuts prices for early-Mar'24 sales

A major ERW pipe manufacturer specialising in HRC-based products, has implemented a downward price revision for its base-grade pipe (25-125 NB, 2.2-6 mm) for early-March 2024 sales, sources informed BigMint.

Following this adjustment, prices now stand at INR 60,500/t ($730/t) exy-Raipur, excluding 18% GST. This marks a decrease of approximately INR 2,000/t ($24/t) m-o-m in Raipur, driven by a decline in HRC prices. It is worth noting that the company had revised prices for February sales.

Moreover, the manufacturer has reduced prices m-o-m for Hyderabad to INR 63,500 ($766/t) exy for early-March sales.

Distributor-level prices for ERW pipe also saw a decline m-o-m amid lack of demand and fall in trade-level HRC prices, which is a key raw material for ERW pipe. ERW pipe prices dropped m-o-m by INR 1500/t ($18/t) to INR 59500/t ($718/t) in March against INR 61000/t ($736/t) in February.

1. Decline in trade-level HRC prices m-o-m: Trade-level hot-rolled coils (HRC, IS2062, Grade E250, 2.5-8mm) saw a price drop in February 2024 compared to January 2024. The price fell by around INR 300/t ($4/t), reaching INR 54,000/t ($652/t) ex-Mumbai in February. Trading activity in the market remained subdued this week, as participants cautiously awaited the price announcements from mills.

During February, the trade market has seen a slowdown. While there's enough supply to meet demand, concerns about excess inventory are making buyers hesitant. Recent imports have further contributed to this cautiousness. Additionally, liquidity issues are prevalent, prompting those in need of liquidity to sell at discounted prices.

2. Imports continue to flow: Bulk HRC and plates imports reached 4,17,653 t till 25 February (provisional). In January, the import volume stood at 6,60,344 tonnes (t), while it was 5,29,661 t in December 2023. This influx of imported material has led to an oversupply situation in the market, resulting in market players adopting a cautious approach which has significantly limited buying activity.