The prolonged downtrend in the local Indian rebar market has been reversed over the past week, with prices making robust gains amid the return of large buyers and the rise in bookings recorded by integrated mills, but doubts persist that this bullish phase may wane as buying has been restricted to only select user segments, SteelOrbis learned from trade and industry circles on Wednesday, November 4.
Sources said trade level rebar prices have surged INR 1,400/mt ($16/mt) to INR 42,700/mt ($481/mt) and have gained INR 600/mt ($7/mt) to INR 43,300/mt ($488/mt) ex-Chennai in the south.
Rebar trade prices are up INR 700/mt ($8/mt) to INR 38,200/mt ($430/mt) ex-Raipur and have risen by INR 500/mt ($6/mt) to INR 37,800/mt ($426/mt) ex-Durgapur in the east.
According to the sources, large engineering, procurement, construction (EPC) companies are seen to be back in the market and have reported large-volume bookings from integrated mills, reversing the recent downtrend and instilling some optimism into the market.
However, a section of the market did not share the optimism, claiming that buying has been restricted to large user sectors, while buying by other sectors like real estate development and rural infrastructure from the retail segment has remained sluggish, casting doubts on the sustainability of the latest price increases.
“We will wait and watch to see if buying activity spreads across user segments and across producers including induction furnace operators before we can be confident of the uptrend. A section of distributors is continuing to liquidate stocks and is offering selective discounts based on buyers’ recent payment records,” a Kolkata-based distributor said.
“It is usual for large EPC buyers to enter the market, complete restocking and exit quickly. Buying at the retail end, even though for comparatively lower trade volumes, sustains market activity for secondary producers. This has to revive if the market is to consolidate,” he added.
$1 = INR 88.74