Are Rising Global Flat Steel Prices a Sign of Improvement for the Indian Industry?

Indian flat steel, particularly the HRC (Hot Rolled Coil) sector, has experienced a period of stagnation in terms of demand and prices. However, prices in the international market are improving gradually, which raises questions about their potential impact on the Indian flat steel industry. Let’s have a look at all the possibilities…

Current Scenario in the Indian Flat Steel Market

The Indian mills raised prices by Rs 500-1,000/ton (US$ 6-12) during the first week of May 2024. However, firm demand and uncertainty in the global market resulted in stability in the domestic price range post that.

This stability raises speculations regarding how Indian mills will respond to the evolving global price dynamics.

Indian Domestic HRC Prices

• The current offers in various markets are as follows:
• Ex-NCR/Delhi: Rs. 55,000/ton
• Ex-Mumbai: Rs. 56,000/ton
• Ex-Ahmedabad: Rs. 56,000/ton
• Ex-Chennai: Rs. 56,500/ton
• Ex-Kolkata: Rs. 53,500/ton
• Ex-Hyderabad: Rs. 55,500/ton

Global Price Surge by Major Flat Steel Producers

OfBusiness noted that China’s leading flat steel manufacturer Baosteel has lifted offers of some products for June sales, while Anshan Iron & Steel (Angang) and its subsidiary Benxi Iron & Steel (Bengang) chose to maintain quotation levels similar to those in May. For June domestic sales, Baosteel has increased prices by CNY 50/ton (US$ 7/ton) for hot rolled coil , pickled, galvalume, and high aluminium-zinc-aluminium-magnesium steel.

Also, the Vietnamese hot rolled coil import market is gradually improving. Domestic producer Formosa Ha Tinh Steel (FHS) increased its monthly HRC domestic prices by around US$ 15/ton.

In addition, China Steel Corp (CSC), Taiwan’s largest steel mill raised list prices  by NT$300 (US$ 9.5/ton) for HRC and CRC for local sales in June. Citing a gradually improving global economy and an OECD forecast of 3.1% growth this year, CSC anticipates increased demand.

Are Indian Mills Planning for Flat Steel Price Revisions?

As the flat steel prices are rising in the international market, the participants believe that the Indian mills may announce a revision in the prices by month-end or June deliveries.

Sources anticipate that, since the elections are underway in the country, immediate price revisions by mills are less likely as domestic demand is not up to the mark.

The initial price hike in May was announced due to the maintenance works at a few mills as well as active demand. However, post-price hike, the response from buyers to the mills was reported to be modest. As a result, immediate price revisions are less likely.

While analysing a continued surge in primary mills’ long steel prices, especially in TMT, the scope of the downtrend in the flat steel market is very limited.

Thus, in the coming weeks, with the end of elections, the participants are optimistic to see a boost in the steel industry performance. Considering this, the flat steel market looks promising to the industry experts.

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