India: Trade-level coated flat steel prices edge down by INR 400/t ($5/t) in recent assessment

The weekly assessment of the trade-level coated flat steel prices dropped a mere INR 400/t ($5/t) amid lacklustre demand and low market activity levels. The aftermath of Diwali and Chhatth Pooja has seen a comparatively slow-paced comeback of market participants in the traders' market. The issue around the availability of labourers was voiced among the leading reasons behind the former.

A rollover of prices by major Indian-coated flat steel producers for November sales failed to ignite the demand in the traders' market. The cautious buying approach of end-buyers has dominated the best portion of the current year and still remained a pain point for distributors, who are locked in a tug-of-war between mills and buyers.

Trade-level prices of coated flat steel products have dropped further by INR 400 t ($5/t) in the key market of Mumbai this week. The weekly assessed prices of GP (0.8mm, 120gsm) coil stood at INR 68,300/t ($820/t) exy-Mumbai, whereas those of PPGI (0.5mm, 90gsm) stayed inert at INR 78,600/t ($943/t) exy-Mumbai as on 24 November 2023. The lower quotes from distributors or sellers to entice buyers amid a slow market is being pointed out as a reason behind the price movement.

Mills faced challenges from elevated raw material prices in the preceding couple of months and thus are little interested in extending any discounts or rebates, according to a few industry sources.

Furthermore, the ongoing elections and those expected to be announced later in the upcoming months shall be a major concern for most industry participants. A few sources raised their concerns about no new government-funded projects in the green energy, infrastructure, and construction space. These are likely to take away some avenues of sales for mills, who have enjoyed the most amidst improved activities in the former over the last couple of quarters.

Another major concern is that the automobile industry is going to slow down production and put plants on annual maintenance runs with the year closing to an end. These concerns are anticipated to outweigh the recent increase in raw material prices, said a few distributor sources.