September was widely perceived to be turn point for steel prices, especially for flat products, in India with the waning of monsoon and pick up in seasonal demand.
Riding the crest on a premature enthusiasm most of the Indian steel mills hiked prices in the range of INR 500 per tonne to INR 1000 per tonne in September. The curtailed production owing to iron ore and gas shortage influenced the price hike by few mills but the temptation was primarily inspired by seasonality.
On one hand if it was the desperation of the mills to wriggle out of burgeoning cost escalation on the other hand depreciating rupee provided the mirage of market capitalisation at home as imports became dearer losing sight of the market realities.
With auto sales plummeting MoM and borrowing cost escalating with RBI hiking interest rates 11 times in the last 18 months, the ramifications took a pandemic proportion engulfing consumer durables and construction sector as well.
In the backdrop of gloomy economic and market outlook with industrial production plummeting to merely 3.3% in July lowest in 2 years coupled with an equally disappointing GDP of 7.7% expecting a magical recovery can be termed cynical.
It is learnt that the stock levels with the mills and buyers are low but need based buying is preferred to limit the risk.
Most of the mills have already retraced the wrong foot by giving rebates and quantity based discounts to the tune of INR 500 tonne to 1000 per tonne.
Another interest hike in the offing on 16th there won’t be any respite in September. More so Pitra Paksh lasting till 28th September even the divinity is unfavourably disposed.
|PI - Narrow Plates||8256||8240||-16|
|PI - Wide Plates||8598||8576||-22|
|PI - Hot Rolled||8340||8317||-24|
|PI - Cold Rolled||9561||9533||-28|
|PI - Galvanized||9267||9247||-20|
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