The downtrend in the local Indian rebar market has gained momentum over the past week, with prices extending sharp losses as producers and distributors have been forced into discounted sales in order to maintain movement of stocks and avoid inventory pressures, while overall demand from key sectors is not indicating any positive signals, SteelOrbis learned from trade and industry circles on Tuesday, October 14.
Sources said that rebar trade prices are down INR 500/mt ($6/mt) to INR 42,500/mt ($479/mt) ex-Mumbai and have decreased by INR 200/mt ($2/mt) to INR 43,800/mt ($493/mt) ex-Chennai in the south.
Rebar prices have fallen by INR 600/mt ($7/mt) to INR 38,200/mt ($430/mt) ex-Raipur in the central region and lost INR 300/mt ($3/mt) to INR 38,200/mt ($430/mt) ex-Durgapur in the east.
The sources said that, with no demand revival on the horizon, both trade and induction furnace operators have been forced to offer discounts to push sales. At the same time, major user sectors in construction and urban infrastructure have been maintaining a slowdown in activities and have been cautious in restocking raw materials.
“The market dynamics both from the supply side and demand are becoming more bearish week on week. No sale is possible without sellers dropping prices and that too for very small-volume bookings,” a Kolkata-based distributor said.
“We hear that average capacity utilization of the induction furnace segment is around 65-70 percent and the continuation of the current trend will force operators to lower it further to curtail variable costs as margins from finished steel come under further strains,” he added.
$1 = INR 88.77
