Flat Steel Market Sees Price Corrections Amid Weak Demand
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The flat steel market reported minor price corrections in Hot Rolled Coil (HRC) due to weak demand and increased imports. The construction and automotive sectors face reduced activity, leading to a challenging environment for domestic producers.
Price
The flat steel markets have reported a slight price changes in Hot Rolled Coil (HRC) products over the weekend.
The prices for major locations are listed below:
The HRC offers are below:
- Ex-NCR/Delhi: Rs. 53,800/ton
- Ex-Mumbai: Rs. 53,800/ton
- Ex-Ahmedabad: Rs. 54,300/ton
- Ex-Chennai: Rs. 55,000/ton
- Ex-Kolkata: Rs. 53,000/ton
- Ex-Hyderabad: Rs. 53,000/ton
The CRC offers are below:
- Ex-NCR/Delhi: Rs. 62,000/ton
- Ex-Mumbai: Rs. 64,500/ton
- Ex-Ahmedabad: Rs. 64,500/ton
- Ex-Chennai: Rs. 66,500/ton
- Ex-Kolkata: Rs. 61,000/ton
- Ex-Hyderabad: Rs. 63,000/ton
PM Plates prices for Delhi NCR stand at around Rs. 59,500/ton and Rs. 58,700/ton for Mumbai on an ex-works basis, respectively.
Demand and Supply
- Demand for Hot Rolled (HR) plates, crucial for fabrication and construction, has significantly decreased. The construction and automotive sectors are experiencing reduced operational activity.
- The recent decline in domestic Hot Rolled Coil (HRC) prices in India is attributed to weakened local demand and increased import volumes. This situation is creating a challenging market environment for domestic steel producers, who are contending with oversupply issues and heightened competitive pressures.
News
- Germany's proposed Low Emission Steel Standard (LESS) could significantly impact India's steel industry, warns the Global Trade Research Initiative (GTRI). Although not legally required to comply, disregarding LESS might harm India's steel exports, which have already declined by 31.2% from $31.7 billion in 2021-22 to $21.8 billion in 2023-24.
- Imports have surged by 37%, making India a net importer. LESS classifies steel based on its carbon footprint, and much of Indian steel may fall into lower emission categories, potentially deterring buyers. GTRI suggests Indian steel producers adopt low-carbon technologies to remain competitive in the global market.
Expert Opinion
- The current negative spread between Hot Rolled Coil (HRC) and rebar prices is creating a bearish outlook in the short term. This trend suggests potential weakening in HRC demand or possible oversupply, raising concerns among market participants.
- Steel producers and investors might need to adapt their strategies in response to this challenging pricing environment. Overall, the negative spread is leading to caution in India’s steel market.
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