Local Indian rebar prices have remained unchanged at lower levels over the past week and, though there is some optimism that the recent declines have been checked, any expectations of a demand uptick have been tempered by widespread unseasonal rains across the country, delaying the resumption of post-monsoon construction activities, SteelOrbis learned from trade and industry circles on Tuesday, September 21.
Most of the trading activity seen in the market has been discount-driven and this is unlikely to change without any significant demand and price revival which would enable secondary mills to improve capacity utilization levels currently averaging at lows of 50-60 percent.
The sources said that local rebar prices have remained at INR 48,000-49,500/mt ($651-671/mt) ex-Mumbai net of discounts heard at around INR 1,500/mt ($20/mt). In regional markets around Kolkata in the east and Raipur in central India, deeper discounts of around INR 2,000/mt ($27/mt) have been reported from dealers and secondary mills, attempting to push volumes in the market.
Integrated steel mills have maintained prices at INR 54,000-55,000mt ($734-747/mt) ex-works, with flat discounts of INR 2,000-3,000/mt ($27-41/mt) offered irrespective of volume bookings.
“The usual post-monsoon revival in construction activities and hence raw material demand has been postponed by at least another month by unseasonal rains. Even large infrastructure projects have been affected by the rains. Even at low capacity utilizations, secondary mills are seeing at least a 15-20 percent rise in September inventories on month-on-month basis,” sources at Shyam Steel Limited, eastern India’s largest rebar producer, said.
$1= INR 73.70