The higher rebar base prices effected by Indian integrated steel mills earlier in the month have showed some signs they will not be sustained, with rising inventories leading to lower tradable prices across regional markets and increased discounting by secondary steel mills to keep pushing volumes into the market, SteelOrbis learned on Tuesday, October 13.
Sources said that integrated steel mills have maintained their base prices at the higher levels of INR 37,450/mt ($511/mt) ex-stockyard over the past week, while secondary rebar produced have also kept listed prices unchanged at around INR 30,700/mt ($419/mt), ex-stockyard.
However, continued depressed demand from both large infrastructure projects and residential housing projects due to a liquidity crunch has caused tradable prices for rebar from both integrated steel mills and secondary producers to seek lower levels.
Market sources said that in southern regional markets, the predominant hinterland of producers like integrated mill Rashtriya Ispat Nigam Limited (RINL), the rebar booking price has been reported at around INR 35,500/mt ($484/mt) ex-works.
As for secondary mills, the rebar traded price in northern markets was highest at INR 30,000/mt ($409/mt) ex-stockyard, the sources added.
“The overall steel market is showing divergent trends. At one end, there is rising demand and tightening of supplies for flat products. In the case of long products, demand is refusing to show any positive signs, putting pressures largely on secondary mills with exclusive rebar capacities in the face of rising input costs and a liquidity squeeze,” an official at RINL said.
“For integrated steel mills largely dependent on bulk bookings from infrastructure projects and government funded projects, demand is still at pre-Covid levels, putting pressures from rising inventories and input costs on operational viabilities,” he added.
$1 = INR 73.30