Local Indian rebar prices have remained stable during the past week as both integrated steel mills and secondary producers held the price line even as market conditions showed no material change, with smaller trading firms and user industries lowering their activities owing to the festival holidays.
With market conditions remaining sluggish and thin activities in the market, it is difficult to assess the impact of the recent price increase effected by secondary rebar producers and its full impact will be known over the next few full business days.
The sources said that integrated steel mills have maintained rebar prices unchanged in the range of INR 38,450-38,700/mt ($515-518/mt) ex-stockyard while secondary producers have kept prices unchanged at INR 32,200-32,500/mt ($432-436/mt) ex-stockyard.
However, the sources pointed out that rebar prices of secondary producers in northern Indian regional markets are reported to be higher at levels of around INR 33,000-33,500/mt ($442-449/mt) with the suspension of freight train movement in Punjab owing to farmers’ protests and resultant bottlenecks in supplies being cited as reasons for the higher price in this region.
A large section of market intermediaries and end-user industries are expecting at least a marginal reversal of negative sentiments and trade activity in wake of the government announcing fresh tax relief to home buyers to spur housing purchases, a new platform for the funding of infrastructure projects, and additional investments in affordable housing construction, as part of the third tranche of the stimulus to revive the pandemic-hit economy.
“There will of course be a lag period between the announcement of the new stimulus by the government and the actual impact on the market. But any support to housing construction will have a mitigating impact on the sustained demand depression in the long product market,” an official at state-run long steel producer, Rashtriya Ispat Nigam Limited (RINL) said.
“Additional investments in affordable housing construction will spur demand for secondary rebar producers. However, given the deep depression, the question is how much or how fast a revival can be achieved and the seamless flow in credits and investments into new projects,” he added.
$1 = INR 76.40