India steel: Monsoon rains hit HRC demand

India's domestic hot-rolled coil (HRC) price continued to decline this week on falling demand, as monsoon rains restricted economic activity and limited cash flows.

"Buying has come to a standstill, and mills are now desperate to offload their inventory," said a stockist in Visakhapatnam on India's southeast coast.

The Argus-assessed price for HRC ex-Mumbai fell by 1,000 rupees/t from last week to Rs38,500/t ($577/t).

The Argus-assessed Indian HRC price has now fallen by Rs2,250/t from Rs40,750/t in the first week of June.

Major HRC producers cut their ex-mill offers to Rs38,500/t this week. Bids were even lower at Rs37,500/t.

Mills are willing to give discounts of up to Rs1,000/t for immediate cash payment terms, said a Mumbai-based trader.

Demand for automobiles and consumer durables is seasonally weaker during the June-September monsoon, while construction activity also slows. The liquidity crunch in the economy has delayed payments to steel traders, as contractors on construction projects are not getting paid on time.

There is increased talk that additional safeguard duties on HRC imports may be announced soon to stem inflows from countries such as Japan and South Korea, market participants said.