The reopening of China has led to an ongoing readjustment of the global metals and commodities markets. China has a massive production capacity surplus to its own domestic demand. At the same time, it also has high domestic demand.
China is also becoming carbon sensitive. The country’s data has not yet been released since China clubs January-February data together due to the New Year holiday period.
As a result, industrial metal prices have been volatile. International steel manufacturers who were suffering from low demand, have started to hike prices. Raw material costs have also soared. This could start to impact margins for Indian steel producers from the first quarter of the 2023-24 financial year (Q1FY24) although margins should not be affected much during Q4 FY23.
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