India: Trade level HRC market under pressure from imports, limited demand

Hot-rolled coil (HRC) prices experienced a decline of up to INR 600/t ($7/t), settling within a range of INR 51,000-INR 54,400/t ($609-650/t). The Chennai market witnessed a more pronounced decrease of INR 2,200/t ($26/t), with prices ranging from INR 52,000-53,500/t ($621-639/t).

Cold-rolled coil (CRC) prices also followed a downward trajectory, dropping by up to INR 600/t ($7/t) and establishing a price range of INR 57,000-63,000/t ($681-753/t) across markets. Delhi's CRC market specifically experienced a price reduction of INR 1,000/t ($12/t), with prices ranging from INR 58,500-60,000/t ($699-717).

The prevailing market conditions indicate persistent sluggishness in trading activity, primarily driven by weakened demand and the availability of cost-effective alternatives.

BigMint's benchmark assessment (bi-weekly) for HRC (2.5-8mm, IS2062, Gr E-250 Br.) prices decreased by INR 500/t ($6/t) to INR 51,500/t ($615/t) on 23 July 2024, compared to the previous week. However, CRC (0.90mm, IS 513, CR1) prices went down by INR 400/t ($5/t) at INR 59,300/t ($708/t) during the same period. These prices are quoted ex-Mumbai, excluding 18% GST, and are for cut-to-length (CTL) deliveries. (INR 1 = USD 0.0119461 ; USD 1 = INR 83.7095)

Market updates

1. Market facing low demand, cheaper alternatives: The traders' market is characterised by persistent sluggishness due to limited demand. Buyers are aggressively negotiating for price reductions and purchasing smaller quantities to meet immediate needs.

A market participant opined, "Market activity remains subdued, with buyers exerting downward pressure on prices." The influx of competitively priced materials, including imports, has further intensified prices.

2. Export, import trends: India's bulk HRC and plate imports are surging, according to vessel line-up data compiled by BigMint. Imports are 3,49,113 till 22 July 2024 with an estimated additional 3,50,849 tonnes (t) expected to arrive by end July 2024.

Indian steel mills are currently focusing on domestic sales of HRC and refraining from exporting to Southeast Asia and the Middle East. Due to competitive global prices, subdued global demand, and a seasonal slowdown in critical markets such as Europe and the Middle East. Consequently, the export market for Indian HRC remains subdued at present.