Downward movement gained momentum in the local Indian rebar market with prices losing ground more rapidly amid rising inventories across distribution channels and outlook turning more negative on steadily weakening demand across retail and tender based sales, SteelOrbis learned from trade and industry circles on Tuesday, December 26.
Indian trade rebar prices were down INR 800/mt ($10/mt) at INR 48,500/mt ($583/mt) ex-Mumbai and lost INR 700/mt ($8/mt) at INR 48,300/mt ($581/mt) ex-Chennai in the south.
Rebar price was down INR 600/mt ($7/mt) at INR 43,200/mt ($519/mt) ex-Raipur and fell INR 800/mt ($10/mt) to INR 43,000/mt ($517/mt) ex-Durgapur in the east.
“The fundamentals of the market are extremely weak now. Demand across retail and tender based sales to large engineering, procurement, construction (EPCs) companies is falling at a time when induction furnace operators are reporting rise in inventories. We are seeing a prolonged bearish phase now,” a Kolkata based distributor said.
“Since rebar prices have been losing ground for the past two or three weeks we cannot attribute it to the usual year end considerations. Any rebound can be discounted barring some minor upward correction,” he said.
An official with an eastern Indian based secondary mill said that as per industry estimates, mills in eastern region are currently operating in the range of 75-80 percent capacity utilizations, while northern and central region mills are averaging at 65-70 percent capacity utilization levels.
He said that without a sustainable improvement in prices, mills will be forced to reduce utilizations levels further as rising inventories are ‘hurting financial viability of the business’.
$1= INR 82.20