India: Trade-level HRC-CRC prices range-bound, demand still sluggish

Trade-level prices of hot-rolled coils (HRC) and cold-rolled coils (CRC) stood range-bound in the key markets of India. Buyers are avoiding purchasing in bulk volumes and continue to procure on an urgent need basis, a few distributors said.

SteelMint's benchmark bi-weekly assessment for HRCs (IS2062, Gr E250, 2.5-8mm) stood at INR 55,000-56,000/t ($671-683/t) exy-Mumbai on 20 June. The average of the assessed price range remains unchanged against the previous assessment on 13 June. However, it has edged down by INR 200/t ($2/t) w-o-w.

CRC (IS513 Gr O, 0.9mm) prices also stood unchanged at INR 59,000-60,000/t ($720-732/t) exy-Mumbai against the levels seen in the preceding week. Prices mentioned above exclude GST at 18%. (INR 1 = USD 0.0121966 ; USD 1 = INR 81.9903)

Market highlights-

1. Upcoming holidays keep Indian HRC export offers range-bound: Indian mills have been facing price competition on the global trade platform over the past few weeks. Meanwhile, overseas trade activities have slowed down because of the upcoming festivals in the Middle East and China. The Middle East market is seeing less activity ahead of the Eid Al Adah which is falling on 28 June, while China's Dragon Boat Festival is from 22 June to 24 June. SteelMint's India HRC (SAE1006) export index was assessed at $565/t FOB east coast India against the previous week's $566/t FOB.

Sentiments in the overseas markets are mixed amid the volatility in Chinese futures. HRC futures October contract on the Shanghai Futures Exchange (SHFE) settled at RMB 3,807/t ($530/t) on 21 June, down by RMB 32/t ($4/t) d-o-d, and by RMB 35/t ($/5t) w-o-w. However, HRC (SAE1006) export offers from China to the UAE were heard at around $590/t CFR, up $10/t w-o-w.

An export deal for about 20,000 t of HRCs was heard sealed by an Indian mill at $655-660/t (EUR 605/t) CFR Antwerp for end-July or early-August shipment. The deal was concluded towards the previous weekend, while fresh offers are heard at around $660/t CFR Antwerp, up by $5-10/t w-o-w.

2. No recent HRC import bookings heard: End-user industrial buyers are still cautious to book bulk volumes. Imported HRCs that were booked about a month ago at cheaper prices are arriving into India which has kept buyers more cautious about the domestic price trend. "We have heard some imported HRC cargoes arriving into India which were booked a month back or so. The landed cost of those arrivals is around INR 49,000-51,000/t at the port," said a western region-based major distributor.

Current offers for Chinese HRCs to India were heard at around $585-590/t CFR. The landed cost of import should come to around INR 53,400-53,800/t ($651-657/t) CFR at the port. However, amidst BIS certification issues, not many mills are aggressively offering in the Indian market.

No fresh import bookings for August or early-September deliveries have been heard. Also, Japanese mills are not offering HRCs for exports to the Southeast Asian markets, and Vietnamese mills are heard to have exhausted allocations for the August and early-September deliveries. This is a factor that has lent some support to the domestic trade level prices.

Near-term outlook: India's domestic trade level prices of HRCs and CRCs are likely to stay range-bound in the near term. Global HRC offers too have started stabilising and even edged up in a few markets. Also, a few participants opined that domestic market demand shall start improving by mid-July 2023.