Sluggish Demand And Falling Prices Impact Indian Flat Steel Market: Find Out Why Prices Are Plummeting

The Indian Hot-Rolled Coil (HRC) and Cold-Rolled Coil (CRC) market is currently experiencing a sluggish trend due to subdued demand. Suppliers are actively seeking buyers both domestically and in export markets. In mid-May 2023, the trade prices for domestic HRC and CRC dropped by approximately Rs. 1,000-2,000/ton from April 2023, settling at Rs. 61,000-61,500/ton and Rs. 65,000-65,500/ton, respectively, in the Mumbai market. This downward adjustment reflects the current state of the Indian HRC market as suppliers respond to the influx of inexpensive imports.

Current Scenario

• Weak Demand- Flat Products face weak demand, particularly for HRC, with limited purchases by end consumers. Falling prices from Chinese mills raise concerns for Indian mills seeking export orders. The European market’s demand remains sluggish due to inventory accumulation and no consumption improvement.

• PM Plates Prices- The prices of PM plates were relatively stable due to the limited availability, an average demand was observed especially for special quality plates amid moderate supply.

• Current Exports Offers- The export offers for Indian HRC stood at around $597-602/ton FOB basis, however, dropped by around $3/ton within the last 10 days. Limited transactions have been reported despite this fall because purchasers are waiting for market stability on a global scale.

Price Movement

After price cuts, the mill’s current offers for Flat Products are as follows:

• HRC
  • Ex-NCR/Delhi: Rs. 59,000/ton
  • Ex-Mumbai: Rs. 58,500/ton
  • Ex-Ahmedabad: Rs. 59,500/ton
  • Ex-Chennai: Rs. 61,000/ton
  • Ex-Kolkata: Rs. 57,500/ton
  • Ex-Hyderabad: Rs. 60,500/ton

• CRC
  • Ex-NCR/Delhi: Rs. 63,500/ton
  • Ex-Mumbai: Rs. 64,700/ton
  • Ex-Ahmedabad: Rs. 63,500/ton
  • Ex-Chennai: Rs. 65,000/ton
  • Ex-Kolkata: Rs. 63,800/ton
  • Ex-Hyderabad: Rs. 66,500/ton 

Market Outlook

Due to low demand and increased availability, Flat Products have a dim future in the current market. Sellers are lowering prices to move goods while buyers are taking a cautious approach and only purchasing urgent materials. Unfavorable export order prices put additional pressure on mills and could cause price adjustments in the upcoming week.

OFB’s Insight 

The Indian Flat Products market, particularly the Hot-Rolled Coil (HRC) segment, is grappling with weak demand and falling prices. The slow buying from end consumers and low prices offered by the Chinese mills in the international market pose challenges for Indian mills to secure export orders. As a result, suppliers are adjusting prices downwards to stimulate sales, while buyers exercise caution in their purchasing decisions. The future of Flat Products appears uncertain, with limited prospects for improvement in the near term.

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