The hot rolled coil price recently dropped to the range between USD 900 -USD 1100/short ton, but the prices for cold rolled coil were stable, with prices ranging between USD 1200-USD 1350 as per sources from mills and service centres.
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At present, there is an overstock of Canadian and Mexican coil, which might be the reason behind the price decline.
Buyers are also wary of the present market situation and pricing. The fluctuations in prices have confused a lot of buyers changing the consumer sentiment to a need-to-buy basis. Some producers are working on making finished products for the forecast releases.
The prices of steel have been dwindling since the beginning of FY24, which can also be a result of weak demand in China. Steel prices have been the trendsetter for the global steel sector. As the domestic demand falls, China has boosted its exports to international markets like India.
The regional prices for the commodity have been facing pressure since March, and the pressure has magnified. Steelmakers in India are witnessing a double hit as recovery in demand was slower than expected, and there is a drop in realizations.
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According to the Procurement Resource article, prices of HRC are falling in contrast to CRC, which remains stable. The factors that can be attributed to the decline include the oversupply of the Canadian and Mexican coil and uncertainty in the market due to China's weak demand.
However, despite lower realizations pressuring the profitability of steel manufacturers, a decline in raw material prices, including coal and iron ore, will likely offer some relief.
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