Local Indian rebar prices have remained under pressure from mills lowering prices of long products to overcome the slow movement of stocks and from the pessimism in trade channels as the lean season for sectors like construction approaches, SteelOrbis learned from trade and industry circles on Tuesday, June 6.
Indian rebar trade prices are down INR 1,500/mt ($18/mt) to INR 51,400/mt ($622/mt) ex-Mumbai and have lost INR 800/mt ($10/mt) to INR 50,700/mt ($613/mt) ex-Chennai in the south.
Rebar prices, however, have remained at INR 47,000/mt ($568/mt) ex-Raipur, but have lost INR 200/mt ($2/mt) to INR 46,400/mt ($561/mt) ex-Durgapur in the east.
At least two leading distributors in the west and east confirmed that several in trade channels have stopped offering even short-term credit payment facilities for bulk bookings and have been accepting bookings only on “cash and carry basis” in the face of the tight liquidity situation in the business environment and delays in receivables resulting in a large section of buyers staying away from the market.
They said that, though it is not yet a payment crisis in the retail trade, delays in receivables have been severely affecting distributors already facing challenges of slow stock movement.
“Prices will remain volatile. Producers are lowering prices to liquidate stocks but not with much success. Everyone in the consuming sectors is cautious about restocking raw materials when the monsoon season ahead will slow down construction activity,” a Kolkata-based distributor said.
“On the other hand, billet prices are rising on the back of higher fuel and energy costs. A number of states will go in for elections later this year, which will also dampen overall business activity,” he said.
$1 = INR 82.60