India: Mills may raise coated flat steel prices for Feb'25; offers rise in traders' market

Trade-level coated flat steel prices increased w-o-w in the major markets under assessment amid the possibility of a price hike announcement by mills. The market is buzzing with the news of a possible price hike of INR 1,500-2,000/t ($17-23/t) by major producers for February 2025 sales.

The latest weekly assessment showed galvanised plain (GP, 0.8 mm/CTL, 120 gsm, IS277) steel prices increasing by 400/t ($5/t) to INR 57,900/t ($668/t) exy-Mumbai, with offers varying in the range of INR 57,000-58,500/t ($658-675/t). Similarly, pre-painted galvanised iron (PPGI, 0.5 mm/CTL, 90 gsm, IS14246) was assessed at INR 66,800/t ($771/t) exy-Mumbai, up INR 400/t ($5/t) w-o-w, with offers at INR 66,000-67,500/t ($762-779/t). Prices are minus GST at 18% (USD 1 = INR 86.6305; INR 1 = USD 0.0115433).

Market updates

Distributors quote higher despite low buying interest: Distributors in the market had started quoting higher and pushed the offers by another INR 500/t ($6/t) this week. The previous week's higher quotes did not change the average quote; however, in the current week, the latter has risen.

"A few producers are pushing distributors to lift materials citing an increase of INR 1,500-2,000/t in their tags for February. The shortfall in supply from some mills in January also caused higher quotes in the traders' market earlier this month. On the other hand, buyers are still tucked to low volume procurements raising concerns for distributors," said a distributor source based in western India.

Improvement in inquiries and trades is expected in the next couple of weeks before the participants get busy reconciling their financial books for the fiscal year (FY) 2025.

Production and consumption in Dec'24: The production of coated flats eased in December 2024 to 1.138 million tonnes (mnt) compared to 1.166 mnt in November, as per the Joint Plant Committee (JPC) data. The production figures for December include galvalume (0.141 mnt) and colour-coated finished flat products (0.272 mnt). Consumption, on the other hand, increased by 0.118 mnt m-o-m to 0.964 mnt in December.

Imports in December at 0.107 mnt increased from 0.092 mnt a month back. Similarly, exports increased to 0.180 mnt which were o.53 mnt in November.

Outlook: Trade-level prices are likely to rise in the near term due to the mills' indication of a price hike for February sales. Meanwhile, the anticipated increase in market activities ahead of the fiscal year-end might boost trade activities in the first fortnight of February. The Budget, too, is keenly awaited by industry participants as fund allocations to various end-user sectors shall be pivotal to strategically target them for sales.