India: Steel mills raise HR plate prices by up to INR 2,000/t ($24), trade prices also increase

Major Indian plate producers have increased hot-rolled (HR) plate prices by around INR 1,000-2,000/tonne (t) ($12-24) for early-January sales earlier this week. Trade reference prices have also showed an increase with improved buying activities since mid-December.

Subsequent to the price announcement, HR plate (E250, 20-40mm) list prices for January sales are-

• AM/NS India: INR 61,000/t ($738)
  
  
• JSPL: INR 64,500/t ($780)
  
  
• Prices mentioned are on an ex-Mumbai basis, exclusive of GST @ 18%.
  
  

Why have mills increased prices for January sales?

Trade market picks up pace: Buying activities in the traders' market improved in January compared to previous months. "The decline in prices in the last few months, pentup demand and reduced inventories led to improved buying activities in the latter half of December," said a reliable source. The continual decline in trade reference prices in November had stalled by mid-December and prices started increasing with mills indicating a price increase for January sales, he added.

SteelMint's weekly price assessment for HR plate (E250, 20-40mm) increased by INR 2,400/t ($29) to INR 60,500-61,500/t ($732-744) exy-Mumbai as on 5 January 2023. Prices had dropped to INR 57,200/t ($692) exy-Mumbai by mid-December from INR 61,100/t ($739) exy-Mumbai in early-November, as per SteelMint records. Prices mentioned above exclude GST @18%. (INR 1 = USD 0.0120967 ; USD 1 = INR 82.6673)

Industrial consumers show optimistism: Among the leading plate consuming industries, heavy engineering, green energy and power distribution and infrastructure-construction segments have started expediting their projects. Automobile industry is also showing an increase in production volumes.

Also, the manufacturing Purchasing Managers Index (PMI) in December 2022 improved at a better pace since August 2022. PMI increased by 3.8% m-o-m to 57.8 in December which is higher compared to the levels of December 2021 (55.5) and December 2020 (56.4).

Near term outlook
Trade reference prices are likey to keep increasing in the near term backed by improved activities from end consuming industries. Meanwhile, participants say that all major sectors including construction/infrastructure and green energy shall expedite their projects, pumping up more demand this quarter.