Since the start of FY24, steel prices have witnessed a continuous downward spiral, primarily driven by the demand weakness in China. As the largest consumer of commodities worldwide, China’s steel prices serve as a bellwether for the global steel industry. With domestic demand falling, China has increased its exports to international markets, including India.
According to ICICI Securities, the price of domestic hot rolled coil (HRC) in the traders’ market fell by ₹500 per tonne week-on-week, hitting a new low of ₹58,200 per tonne on 21 May.
Analysts said dealers are apprehensive about the substantial 20% decline ($115 per tonne) in Chinese export prices over the past month, alongside the underlying weaknesses in domestic demand. Mounting import bookings have contributed to the persistent price downturn, the analysts added.
Chinese export prices are at around $550 per tonne, according to Motilal Oswal Securities Ltd data. All major mills in China and Vietnam have also slashed listing prices for May 2023.
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