India: Trade-level HRC, CRC monthly average prices fall by up to INR 2,000/t in Aug 24

Monthly average prices of trade-level hot-rolled coil (HRC, 2.5-8 mm/CTL, IS2062, Gr- E250 Br.) registered a decline of INR 1,800/t ($21/t) m-o-m to reach INR 50,500/t ($602/t) in August 2024, as opposed to the previous month's figure of INR 52,300/t ($624/t)exy-Mumbai. Simultaneously, prices of cold-rolled coil (CRC, 0.9 mm/CTL, IS513, Gr-O) experienced a decline of INR 2,000/t ($24/t)m-o-m, settling at INR 57,600/t ($687/t) in August 2024, compared to the preceding month's INR 59,600/t ($711/t) exy-Mumbai, excluding GST at 18%.

What happened this month

1. Reduced list prices for August sales: Several Indian flat steel producers reduced the list prices of HRC and CRC by approximately INR 1,000-2,000/t, effective 1 August 2024. One private mill maintained its prices from the end of July.

Effective list prices for early August 2024 were INR 51,500-52,500/t ($614-625/t) for HRC (2.5-8 mm, IS2062, Gr E250, Br.) and INR 57,000-58,500/t for CRC (0.9 mm, IS513 CR1), ex-Mumbai. The listed prices exclude 18% GST.

2. Excess inventory pile-up and declining demand: The trade market continues to experience persistent sluggishness in trading activity, largely attributable to subdued demand coupled with rising inventory levels throughout the supply chain.

A market participant noted, "Increasing inventory levels throughout the supply chain, coupled with financial strain, are raising concerns. Additionally, while both mill production and imports have risen, demand continues to decline, creating a surplus and exerting a downward pressure on prices."

3. Import and export trends: According to BigMint's vessel lineup data, the cumulative import volume for August reached 484,902 t as of 26 August 2024. This represents a decrease from the 636,651 t recorded in July 2024. An additional 192,477 t are expected to arrive by the end of August 2024, with another 318,572 t projected for the first half of September 2024.

Indian steel mills prioritised domestic sales of HRC this month, avoiding exports to Southeast Asia, the Middle East, and the European Union. The decision was influenced by competitive global pricing, sluggish global demand, and the potential for better realisations in the domestic market.

4. Global prices update: Tokyo Steel has kept steel prices unchanged m-o-m for its September 2024 sales. Meanwhile, Formosa Ha Tinh (FHS), a major Vietnamese steel producer, has reduced its HRC prices by approximately $17/t CIF m-o-m for shipments scheduled in October 2024. Pakistan's steelmakers have lowered CRC and coated flat steel prices by PKR 45,000/t ($161/t), effective 23 August 2024.

Assessment update for the week:

BigMint's bi-weekly benchmark evaluation for HRC (2.5-8 mm, IS2062, Gr E250 Br) ex-Mumbai fell by INR 300/t ($4/t)to INR 50,300/t ($600/t). Additionally, CRC (0.9 mm, IS513 CR1) ex-Mumbai fell by INR 100/t ($1/t)to INR 57,300/t ($683/t). All prices exclude 18% GST (INR 1 = USD 0.0119226 ; USD 1 = INR 83.879).