Indian Steel Mills Raise Domestic HRC Prices About INR 1500/MT (USD 23)

Improved demand from automobile industry and less import bookings have collectively resulted in hike in domestic HRC prices.

In line with SteelMint's forecast that Indian steel mills are likely to hike prices in February, few major Indian steel manufacturers including JSW Steel have today announced price hike of INR 1500/MT in flat steel prices.

However government owned steel company - Steel Authority of India Limited (SAIL) is also planning for a price hike, however the increment could not be confirmed at the time of publishing this report.

After increase, price of HRC (IS2062) 2.5 mm-8 mm offered by JSW Steel is assessed in the range of INR 43,500-44,000/MT (ex-Mumbai) and for CRC (IS513) 0.9mm assessed at INR 48,500-49,000/MT (ex-Mumbai).The prices mentioned above are basic prices excluding GST @ 18%.

Market participants mentioned that flat steel prices have shown uptrend owing to growth in demand from automobile sector apart from gap between domestic and imported HRC.

Indian Auto makers reported strong growth in Jan'18 sales volume-
India's largest carmaker - Maruti Suzuki India Ltd reported 4.8% of growth, in Jan'18 against Jan'17. Other auto makers like Mahindra & Mahindra Ltd showed 32% growth and HMIL witnessed 8.5% growth over Jan'17. Besides this country's automobile exports also moved up 15% in Jan'18.

Thus we can analyze that in long run boost in auto and construction sector will definitely improve the demand of flat steel in domestic market.

Also, prior to this price hike landed cost of Chinese HRC imports to India was costlier by around INR 1500/MT than domestic prices in India. However HRC imports from Japan and South Korea have remained on the lower side as these countries have limited export allocations amid strong domestic demand.

In Jan'18, flat steel prices prices reported hike of about INR 2,000/MT owing to surge in iron ore prices in domestic market along with uptrend in imported coking coal offers to India.