The local Indian rebar market has reversed its previous declining trend with prices showing gains, but market participants are uncertain over the sustainability of the upward trend as trading volumes have remained low and the rise in prices is attributed to higher costs and the very big declines seen in earlier weeks, SteelOrbis learned from trade and industry circles on Tuesday, December 6.
Sources said that rebar trade prices are up INR 800/mt ($10/mt) to INR 52,800/mt ($645/mt) ex-Mumbai but are unchanged at INR 51,800/mt ($633/mt) ex-Chennai in the south.
Rebar prices have surged INR 1,900/mt ($23/mt) to INR 47,300/mt ($578/mt) ex-Raipur in the central region and are up INR 1,300/mt ($16/mt) to INR 47,500/mt ($581/mt) ex-Durgapur in the east.
“The price gains seen are on extremely low trading volumes. It is a positive correction after sustained losses. Such a correction is unlikely to be sustained unless there is a definitive demand revival,” a Kolkata-based distributor said.
“Market reports indicate that there are sufficient inventories at both trade and mill ends. This can put new pressures, leading to volatility in price movement. Buyers always tend to remain cautious over volatility,” he said.
According to an official at Shyam Steel, the eastern region’s largest rebar producer, trade level price gains are the reflection of secondary mills attempting to nudge up prices reacting to the rise in prices of sponge iron and billets.
“Most secondary mills are through with cutting prices to drive stocks in the market. With costs rising, producers are not in a position to risk margins to push sales. Mills have to protect operational viability,” he said.
$1 = INR 81.80
