Local Indian rebar prices have continued to record big losses over the past week, with trade channels and secondary mills dropping prices and with buyers largely absent, resulting in stock pile-ups across the supply chain, while bearish sentiments have been aggravated based on negative macroeconomic indicators, SteelOrbis learned from trade and industry circles on Tuesday, June 2.
Sources said that trade rebar prices have lost INR 800/mt ($8/mt) to INR 46,000/mt ($483/mt) ex-Mumbai and are down INR 1,000/mt ($11/mt) to INR 47,000/mt ($494/mt) ex-Chennai in the south.
Rebar trade prices have fallen by INR 300/mt ($3/mt) to INR 41,700/mt ($438/mt) ex-Raipur and are down INR 500/mt ($5/mt) to INR 41,300/mt ($434/mt) ex-Durgapur in the east.
According to the sources, large buyers representing engineering procurement and construction (EPC) companies have continued to remain almost completely absent from the market amid the slowdown in construction activities as a fallout from rising fuel and transportation costs.
Construction activities have also been slowed down by a labour shortage, particularly in the northern regions of the country which are reeling from a severe heat wave, with the government issuing health warnings.
However, the biggest negative impacting sentiments has been attributed to inflationary pressures building up across industrial sectors, and declining demand has forced buyers to reduce bookings to minimal volumes, resulting in inventory rises across the supply chain.
As a result, both trade channels and secondary mills have been forced to drop prices to push sales even though the cost of production is on the rise, sources said.
“Both the mood and actual trade conditions are very bad. Prices have been declining for consecutive weeks now and there are no positive drivers on the horizon. We foresee the current bearish trend being quite prolonged,” a Kolkata-based distributor said.
