Volatile market conditions have surfaced in the local Indian rebar market with traded prices showing losses across a wide range, as a more realistic assessment of the expected revival of construction sector demand has set in among participants, SteelOrbis learned from trade and industry circles on Tuesday, February 15.
The traded rebar prices in India have declined by a wide range of INR 700-1,500/mt ($9-20/mt) as a more bearish assessment has set in as the government increase in large-project funding will have only a limited positive impact on demand from secondary mills which are largely reliant on retail sales and state-level small projects.
In contrast, integrated mills have continued to maintain their higher price levels in the range of INR 60,700-62,000/mt ($803-820/mt) ex-works, sources said.
Trade prices of secondary mills are down INR 1,500/mt ($20/mt) to INR 51,600/mt($683/mt) ex-Mumbai and down INR 700/mt($9/mt) to INR 48,600/mt ($643/mt) ex-Raipur in the central regional market.
In the eastern regional market of Rourkela, the rebar trade price is down INR 1,000/mt ($13/mt) to INR 50,400/mt($667/mt) ex-warehouse.
“Buyers are turning very cautious. New sentiments in the market are getting bearish,” a Kolkata-based steel distributor said.
“Initial bullishness over higher government spending on infrastructure has dissipated. Such an increase in government spending will have a demand push for high-volume sales from integrated steel mills and not in the case of the fragmented secondary steel sector. Hence, integrated mills have increased base prices this month, while secondary mills are lowering trade prices as retail sales and demand from real estate development in semi-urban areas is turning negative,” the trader said.
$1 = INR 75.60
