India: Mills raise coated flat steel prices for early Jan sales; traders' market follows suit

India's leading steel mill, JSW Steel, has announced an increase of INR 1,500/t ($18) in its coated steel list prices with effect from 1 January, 2023. Following this, trade level prices also started rising with distributors quoting offers on the higher side.

Subsequent to the hike, list price for galvanised plain (GP) coils stands at INR 66,550/t ($803) while that of pre-painted galvanised iron (PPGI) at INR 76,500/t ($924). Prices mentioned are exy-Mumbai, excluding GST at 18%.

This is the third price hike by JSW Steel Ltd announced in the second half of December. Last week both JSW and AM/NS India had taken a hike of INR 500/t and another one with the same quantum was announced earlier this week.

Inflow of inquiries showed an improvement in the preceeding two weeks as mills had started increasing prices. "Restocking activities have been better in the last fortnight. However, Christmas and New Year holidays have kept most of the buyers away from the traders' market," informed reliable sources.

SteelMint's weekly assessment of galvanised plain (GP) coils (0.8mm, 120gsm) stood at INR 64,500-65,500/t ($779-791), up by INR 1,800/t ($22). Those of pre-painted galvanised iron (PPGI) (0.5mm, 90gsm) were assessed around INR 72,500-73,500/t ($875-887), up by INR 1,000/t ($12) as on 30 December. Prices mentioned are exy-Mumbai, excluding GST at 18%.

Factors supporting trade level prices

Expectation of further improvement in demand: Demand from major coated flat steel consuming industries has improved towards end-December. "Home and commercial appliances, pre-engineered buildings (PEBs) and panels have been the industries coming up with increased inquiries," shared a western India-based distributor.

It can be recalled that, in November, the apparent consumption of coated flat products showed an increase of 87.4% m-o-m at 1.276 mnt which was mere 0.676 mnt in October. During April-November 2022, the aggregated consumption stood around 5.116 mnt, up by 15.6% y-o-y, as per Joint Plant Committee data.

Export opportunities: Coated steel prices on the global trade platform also showed improvement this month which is another reason that is supporting the market sentiments. Moreover, the removal of 15% export duty on non-alloyed flat steel products since 19 November, 2022 has opened up avenues for exports for Indian producers.

Chinese hot-dipped galvanised (HDG) export offers remained pegged to $720/t FOB as on 29 December after having increased in the preceeding four weeks. However, Indian mills had withdrawn offers last week and are expected to come afresh in the first week of January.

It is likely that other Indian mills will also follow suit and announce revised offers next week.