Local Indian rebar market came under intensified pressures of seasonal low demand, smaller mills dropping prices to push volumes and logistical challenges of transportation of raw materials and finished steel as monsoon rains spread across several regions, SteelOrbis learned from trade and industry circles on Tuesday, June 27.
Indian rebar trade price was down INR 800/mt ($10/mt) to INR 50,000/mt ($610/mt) ex-Mumbai and lost INR 600/mt ($7/mt) to INR 49,200/mt ($600/mt) ex-Chennai in the south.
Rebar trade price dropped INR 800/mt ($10/mt) to INR 46,800/mt ($571/mt) ex-Raipur and down INR 900/mt($11/mt) to INR 46,500/mt ($567/mt) ex-Durgapur in the east.
Market sources said that trade conditions were weakening almost in direct correlation to spread of the monsoon rains and reports of flooding in the west and northern regions. Not only construction activities have been slowing down, both traders and mills faced logistical challenges and higher costs of transportation owing to dislocations caused by rains.
“Everyone in trade and production circles are aggressively dropping prices to liquidate stocks as lean season sets in. Secondary mills have already cut output by 15-20 percent but there are still large volumes in the supply chain even as demand falls in weekly basis,” a Kolkata based distributor said.
“Rebar price still has a lot of downside risk. We assess 5-10 percent further price depression heading into peak monsoon period next month. The only significant trade is tender based sales of large mills to engineering procurement and construction (EPC) companies. But this is insufficient to support secondary mills, accounting for larger share in retail and trade sales,” he said.
$1= INR 82.00
