Indian Steel Prices Experienced Volatility In Week 12 Of 2023; Finished Steel Sales Limited

Week 12^th (18 March 2023-25 March 2023) witnessed limited demand for finished steel products, especially TMT. This led to volatile prices of semis (sponge iron and billets) products, while finished steel prices corrected slightly with a slight increase in inventory with a few mills. The market also reported weak demand for flat steel products, leading to price corrections. In this article, let’s discuss the supply and demand dynamics that led to price fluctuations and the prevailing prices of TMT and flat steel products.

12^th Week’s Highlights: Indian Steel Industry

• Supply And Demand Dynamics 

While supply remained strong with mid-sized steel mills, low to moderate demand slightly raised inventory in the market. This led to buyers remaining skeptical and placing orders only as per their requirements. Additionally, the closing of the fiscal year affected liquidity in the market, leading to limited fresh orders by bulk buyers. As a result, overall orders came down during the week.

• Price Volatility

TMT– Mid-sized steel mills’ TMT prices recorded a fall of Rs 500-800/ton, while sponge iron and billet prices saw a fluctuation of Rs 100-500/ton in major Indian markets.

Pig Iron- The negative price trends continued in the Indian pig iron market, with prices falling by Rs 500-1,000/ton in a week due to strong supply and less demand.

• Primary Mills

Primary mills’ TMT prices also dropped by around Rs 500/ton week-on-week in major locations due to low demand and limited future orders. Flat steel products’ spot prices also moved down by around Rs 500/ton in major locations by providing trade discounts by mills and traders and distributors’ end.

TMT And Flat Steel Products Prevailing Prices

TMT- Primary mills’ TMT prices (for 10-25 mm) were recorded at around Rs 60,500-61,000/ton ex-yard Delhi. Mid-sized mills’ secondary TMT prices were around Rs 54,500-55,000/ton ex-Delhi and Rs 55,500-56,000/ton ex-Mumbai.

HRC- HRC (1.8mm/IS2062) rates stood at around Rs 59,000-59,500/ton ex Delhi NCR, Rs 60,000-60,500/ton for Mumbai and Ahmedabad, and Chennai on an ex-yard basis.

CRC- CRC prices are reported at Rs 64,500/ton ex Delhi NCR, Rs 65,000-65,500/ton for Mumbai and Ahmedabad, and Chennai on an ex-yard basis.

Future Outlook

Industry experts are assuming that prices should find support once spot demand finds support. Currently, most participants are engaged in healthily closing their fiscal year books. Once it is done, an improved payment cycle is likely to result in fresh orders from major buyers. However, the volatility in prices is expected to continue until demand is stable.

Insight 

The limited demand for finished steel products during the 12^th week of 2023 led to volatile prices of semis products, while finished steel prices corrected slightly with a slight increase in inventory with a few mills. The weak demand for flat steel products led to price corrections in HRC and CRC. While the prevailing prices of TMT and flat steel products decreased, industry participants, are hopeful that prices will find support once spot demand improves, leading to fresh orders by major buyers.

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