Indian local rebar prices gained ground following base price hikes by both secondary and primary producers, but terms of payments unfavorable to buyers and uncertainties over ongoing construction projects in wake of rising lockdown restrictions triggered a sharp slump in trading, SteelOrbis learned from trade and industry circles on Tuesday.
Market sources said that rebar base price of integrated steel mills rose to INR 52,000-53,000/mt ($692-706/mt) ex-works compared to levels of base price around INR 48,500/mt ($646/mt) ex-works a week ago.
Following upward revision, base price of secondary rebar mills moved up to INR 49,000-50,000/mt ($652-666/mt) ex-works, compared to levels of around INR 47,000-48,000/mt ($626-639/mt) a week ago.
At least two leading Mumbai based traders said that tradable prices in most regions were at par with base price though in regions worst affected by rising pandemic cases like Maharashtra in the west and Delhi, Punjab in the north reported low volume sales at discounts ranging 2-3 percent.
However, sources pointed out that while high prices were a deterrence to fresh bookings, trading volumes slumped largely owing to adverse terms of payments faced by buyers.
End users like construction companies and real estate developers were willing to restock raw materials, fearing disruptions in supply chain owing to pandemic restrictions, but they were seeking long payment terms of up to 60 days, as they were unsure of completion of ongoing projects and cash flow owing to the restrictions.
However, neither primary nor secondary rebar producers were willing to extended terms of payment in ‘current unnatural trading conditions emerging from second wave of pandemic’, as a result, most buyers were forced not to commit bookings.
$1= INR 75.10