Local Indian rebar prices have continued to show gains over the past week amid high volatility and disparate levels of gains across regions amid reports of a few large engineering procurement, construction (EPC) companies commencing restocking operations in major trading hubs, with the monsoon season drawing to an end in another month, SteelOrbis learned from trade and industry circles on Tuesday, August 5.
The highest gains in trade rebar prices were reported from the largest trading centers where most of the buying by EPC companies was confined to. For example, rebar trade prices surged INR 1,100/mt ($13/mt) to INR 45,200/mt ($515/mt) ex-Mumbai but recorded a more modest gain of INR 200/mt ($2/mt) to INR 45,700/mt ($520/mt) ex-Chennai in the south.
Regional markets also showed volatility and divergence, with rebar trade price remaining unchanged at INR 40,700/mt ($464/mt) ex-Raipur in the central region, but surging by INR 1,000/mt ($11/mt) to INR 40,800/mt ($465/mt) ex-Durgapur in the east.
“The return of large bulk buyers is a positive. However, their presence is limited to major trading centers but at the same time contributes to a lot of volatility as traders in other hubs are speculating on prices. This is not a healthy rebound,” a Kolkata-based trader said.
“EPC buyers generally do not extend their presence for long. They complete their trade for large volumes quickly and exit the market. There is generally very little presence of retail trade in the market and hence trade prices still have a lot of risk of falling back once large buyers complete their buying,” he added.
$1 = INR 87.79