The downtrend of local Indian cold rolled coil (CRC) prices has gained momentum owing to a combination of large industrial users being largely absent from the market, liquidity challenges faced by market intermediaries, and the overall negative outlook for manufacturing growth during the rest of the current fiscal year.
Sources said that benchmark 0.9 mm CRC prices have suffered a big setback, losing INR 1,500/mt ($18/mt) to INR 53,700/mt ($634/mt) ex-Mumbai and down INR 1,000/mt ($12/mt) to INR 55,000/mt ($649/mt) ex-Chennai in the south.
According to the sources, some southern and western-based re-rollers were heard to be pushing sales at a price level of INR 53,200/mt ($628/mt) net of discount.
“Large industrial users comprising consumer durables and automobile manufacturers are largely absent from the market. They are sharply reducing raw material restocking as the festival sales surge is fading and sales growth is settling to low single digits. Both mills and re-rollers are reporting rising inventories, forcing even small-volume sales at lower prices,” a Mumbai-based distributor told SteelOrbis.
“We expect CRC prices to remain range-bound going forward as all key drivers are negative. With the fiscal year-end nearing, market intermediaries have nearly exhausted their working capital limits with banks and are facing liquidity challenges, preventing them from committing fresh bookings, contributing to the thin trade activity,” he added.
$1= INR 84.70