The local Indian rebar market has staged a robust rebound after the previous short-lived correction supported by all-round restocking by trade channels, large bookings received by integrated mills from engineering, procurement, construction (EPC) companies, and the sharp drawdown in stocks due to the latter, SteelOrbis learned from trade and industry circles on Tuesday, August 22.
Indian trade rebar prices have surged INR 2,000/mt ($24/mt) to INR 49,500/mt ($596/mt) ex-Mumbai and are up INR 800/mt ($10/mt) to INR 49,300/mt ($593/mt) ex-Chennai in the south.
Rebar trade prices have gained INR 1,700/mt ($10/mt) to INR 45,900/mt ($552/mt) ex-Raipur in the central region and are up INR 1,100/mt ($13/mt) to INR 45,300/mt ($545/mt) ex-Durgapur in the east.
According to trade sources, though there are no definitive data available, there has been a lot of chatter in trade circles regarding the possibilities of a short-term demand-supply gap emerging, particularly until such time as some integrated mills under maintenance shutdowns resume operations.
The sources said that the market is apprehensive that secondary mills would not be able to fill up the gap “guess-estimated” in the region of 2-4 million mt as trade channels have been aggressively replenishing stocks as volumes start to move faster with the busy season starting next month.
“The mood is very upbeat, particularly from the fact that the correction has been overcome so aggressively. The fears of the market may be an overreaction to irrationally bullish market participants. The market is definitely entering a positive zone after a prolonged bearish phase,” a Kolkata-based distributor said.
“But the moot point is the sustainability of the current upturn as caution remains key in transactions. Negative elements of inflationary pressures, high cost of borrowed funds from lending institutions, and political uncertainties still remain very much a reality,” he said.
$1 = INR 83.10