India steel: Coated prices slide on slow offtake

India's coated steel prices fell this week, as demand continues to be subdued from consumer sectors.

The main application of coated sheets is their use in infrastructure projects or construction sites for roofing, cladding, barricading, paneling, ducting, framing or fencing. But limited public and private-sector investment has slowed down the pace of such projects in the country.

Contractors on infrastructure projects are not being paid on time and have slowed steel purchases to the minimum required to continue immediate work, said a Delhi-based steel trader.

Demand also continued to be weak from consumer sectors such as automobiles, consumer durables and real estate as consumer demand has fallen across the economy.

Offers this week for coated steel products dropped by about 1,000 rupees/t ($14/t). Prices over the past month of coated steel have dropped by about Rs4,000/t.

Galvanised sheet with 0.5-0.7mm thickness with a zinc coating of 90 grams/m² (gsm) fell by Rs1,000/t over the previous week to Rs45,000/t ex-works. Galvanised sheets of similar thickness with lower zinc coating of 80gsm were being offered even lower at Rs44,000/t.

Offers for thicker sheets of 0.8mm and above with higher zinc coating of 120gsm were at Rs47,000/t.

A trade emerged for colour-coated sheet with 0.5mm thickness with zinc coating of 100gsm at Rs51,000/t, a drop of Rs1,000/t over the previous week.

Market participants said that demand may show signs of increases as the festive season that started in September peaks ahead of Diwali on 27 October, although there is not much upside expected to prices next week.