The downtrend in the local Indian rebar market has gained momentum during the past week with even large producers lowering prices as disappointment over the failed demand revival has spread across regions in India, SteelOrbis learned on Tuesday, November 26.
According to traders, large integrated steel mills producing rebar which had been holding prices stable in mid-November, started to revise their prices as pessimism mounted that a demand revival from large government projects would not be forthcoming.
Market sources said that small and medium-scale rebar producers lowered prices by INR 200/mt ($3/mt) to INR 32,300/mt ($450/mt) ex-stockyard. Large integrated steel mills were more aggressive in adjusting prices, reducing them by INR 400/mt ($6/mt) to INR 33,600/mt ($469/mt) ex-stockyard.
The sources said that most large producers are reported to be negotiating new supply contracts with government project implementers offering discounts of three to five percent to ensure the pushing of higher volumes from their stockyards.
No integrated steel mill has reported any export contract during the past week.
“Most local rebar producers are disappointed over the fact the recent government measures announced have failed to revive fresh bookings by government-funded projects. Retail sales for housing constructions have not picked up either even though it has been months since the monsoon season came to an end. This indicates that the slowdown in the market is not cyclical but more fundamental and that the bearish sentiments are fast spreading,” a manager at Rastriya Ispat Nigam Limited (RINL), a primarily long product manufacturer, said.
“Producers attempts to push up rebar prices early this month expecting a demand uptick have failed and, now that such an increase has been rolled back, current price levels will continue to have further downside risks,” he added.
$1 = INR 71.70