India: Trade-level HRC, CRC monthly average prices fall by up to INR 1,600/t in Dec'24

The monthly average trade-level hot-rolled coil (HRC, 2.5-8mm / CTL, IS2062, Gr- E250 Br.) prices registered a decline in Decmber 2024, dropping by approximately INR 1,200/t ($14/t) to INR 46,900/t ($547/t) as against November's INR 48,100/t ($561/t) exy-Mumbai. Cold-rolled coils (CRC, 0.9mm / CTL, IS513, Gr-O) have seen a nominal decline of INR 1,600/t ($19/t) m-o-m, settling at INR 53,600/t ($625/t) in December compared to the preceding month's INR 55,200/t exy-Mumbai, excluding GST at 18%.

Market updates:

1. Mills roll over list prices for December sales: Leading flat steel producers had announced that their list prices for December 2024 would remain unchanged m-o-m. The effective list price of HRC [IS2062, Grade E250, 2.5-8 mm] was in the range of INR 47,000-50,150/t ($548-585/t) ex-Mumbai. Meanwhile, prices of CRC [IS513, Grade O, 0.9 mm] were at INR 53,200-57,150/t ($620-666/t) ex-Mumbai. These prices apply to coil forms and are exclusive of 18% GST.

2. Safeguard duty investigation triggers price surge: Following the initiation of the safeguard investigation by the government, the market witnessed a surge in offers. However, as time progressed, these higher prices failed to gain traction. Buyer resistance emerged, with transactions primarily limited to small volumes at the lower end of the price range, exerting downward pressure on prices.

While elevated prices persisted in the northern region, likely attributed to localised material shortage, this trend remained largely isolated. In other parts of India, increased prices failed to sustain.

3. Export-import trends: Imports of bulk HRC and plates have continued their downward trend over the past four months, reaching 485,449 t in December, according to bulk vessel line-up data maintained with BigMint. This marks a decline from 571,656 t in November and 687,297 t in October. Approximately 171,453t are projected to be imported by first week of January.

Indian HRC export activity in December experienced a gradual slowdown culminating in a significant decline towards the end of the month. Offers to the Middle East witnessed a slight decrease initially, followed by a period of stability, and finally a sharp drop as the Christmas and New Year holidays approached. The European market also saw subdued activity due to the holidays, while competitive pressure from Chinese and Japanese exporters continued to challenge Indian players.

Assessment update: BigMint's benchmark evaluation (bi-weekly) for HRC declined to INR 46,500/t ($542/t) exy-Mumbai as on 31 December, down by INR 200/t ($2/t) against the previous assessment. In the same period, CRC prices increased by INR 200/t ($2/t) to INR 53,500/t ($624/t) exy-Mumbai. These prices above exclude GST at 18%, and are for cut-to-length (CTL) material.

Outlook:

Market participants have sought to raise offers, leveraging the ongoing safeguard duty investigation and the possibility of duty implementation. However, the recent notification extending the deadline for submitting documents related to the safeguard duty investigation has delayed its implementation. Furthermore, the impact of the Karnataka Minerals Bill 2024 remains uncertain, as it has the potential to influence raw material prices in Karnataka.

In the near term, prices are anticipated to remain range-bound, with no significant upward movement expected.