Local Indian rebar trade prices suffered setbacks across all regions in reaction to induction furnace operators dropping prices to check rising inventories, intermediaries staying away from restocking in the face of liquidity challenges, and declining retail sales led by the real estate sector as monsoon rains intensify across the country, slowing down construction activities, SteelOrbis learned from trade and industry circles on Tuesday.
Sources said that rebar trade prices lost INR 100/mt ($1.50/mt) at INR 43,300/mt ($504/mt) ex-Mumbai and fell by INR 300/mt ($3/mt) to INR 45,700/mt ($532/mt) ex-Chennai in the south.
Rebar trade prices were down INR 200/mt ($3/mt) at INR 39,200/mt ($456/mt) ex-Raipur and lost INR 700/mt ($8/mt) at INR 39,800/mt ($463/mt) ex-Durgapur in the east.
According to sources, trade volumes had dipped sharply following the absence of large buyers from among engineering, procurement, and construction (EPC) companies over the past several weeks. The sluggish conditions were aggravated as retail buyers from the real estate sector too were retreating and staying away from restocking as construction activities were being forced to slow down as monsoon rains spread across all regions.
This drop in trade volumes was directly leading to rising inventories of secondary mills, and a few were considering further cuts in output during the rest of the monsoon season, sources said.
It was pointed out that most eastern and central regional induction furnaces were operating at an average of 70–80 percent capacity utilization levels, and with inventories still seeing increases, operators had little option but to consider further cutbacks in output to an average of 60–65 percent to ease supply-side pressures.
$1 = INR 85.95