Morning Brief: Indian steel prices remain range-bound as market awaits clarity from global cues

Chinese steel futures dropped consecutively for the third day, yesterday, raising concerns regarding sustainability of gains (billet prices gained by $100/t) that were made post Chinese labour day holidays, which ended on 05 May.

Buyers continue to remain on the sidelines and are waiting to get some clear direction. While no trades have been reported till the time of publishing this report, markets do expect prices to be in the range of $720-725/t CFR China for 150 mm billets, which were at $780-785/t CFR levels late last week. Indian mills have high exposure to the global markets currently as domestic demand continues to remain low. It has been heard that allocations have been made for over 100,000 IF grade billets from different mills in India.

It has also been learnt that oxygen supplies are slowly easing out and more plants (induction based) are likely to increase their capacity utilisation levels. In this regard, the Chhattisgarh government had earlier written to the Central government asking them to allow 20% of oxygen to be diverted for industrial use. SteelMint learnt that this request has been accepted by the centre and oxygen supplies are soon likely to get back to normal.