The local Indian rebar market has continued to show high volatility and divergent trends over the past week, with trade-level prices moving up sharply in major trading hubs on the back of large construction companies committing fresh bookings, but trade activity has been sluggish in the retail trade-dependent regional centers, SteelOrbis learned from trade and industry circles on Tuesday, August 12.
Sources said that rebar trade prices have surged by INR 700/mt ($8/mt) to INR 45,900/mt ($523/mt) amid robust buying from large engineering, procurement, construction (EPC) companies. But in contrast trade prices have dipped by INR 200/mt ($2/mt) to INR 45,500/mt ($519/mt) ex-Chennai in the south where retail trade activity has remained muted under the impact of low real estate development owing to monsoon rains.
Rebar trade prices have also lost INR 700/mt ($8/mt) to INR 40,000/mt ($456/mt) ex-Raipur and are down by INR 800/mt ($9/mt) to INR 40,000/mt ($456/mt) ex-Durgapur in the east.
According to the sources, large buyers including EPCs have been predominant in large trading hubs like Mumbai in the west and have been aggressively restocking as part of raw material planning for the post-monsoon period, resulting in surging prices. However, the regional market base for retail trade has been seeing muted activity largely because real estate development has remained slow in the face of continued rains and developers are yet to prepare for the post-monsoon season.
“There is a lot of volatility in the market. Large buyers are active but smaller buyers are cautious resulting in divergent trade and pricing situations in the market. There is a lot of speculative activity by a section of market intermediaries,” a Kolkata-based distributor said.
“The market will cool down in a few weeks. Thereafter, a new trend is expected to emerge, factoring in the post-monsoon season demand assessment,” he said.
$1 = INR 87.66