Sentiment has weakened in the local Indian rebar market, with prices seeking lower levels amid the slowing demand faced by secondary mills, even though market participants have remained divided over whether a negative correction is setting in, SteelOrbis learned from trade and industry circles on Tuesday, April 5.
Indian trade prices of rebar are down INR 2,000/mt ($26/mt) to INR 66,300/mt ($877/mt) ex-Mumbai and down INR 700/mt ($9/mt) to INR 61,300/mt ($811/mt) ex-Raipur in the central region. Prices declined by INR 800/mt ($11/mt) to INR 65,700/mt ($869/mt) ex-Chennai in the south.
Trade circles said that in some regions like Telangana in the south real estate developers have halted work on ongoing projects to protest against skyrocketing steel prices and, while this impacted sentiments, market participants are divided on whether this will snowball and spread across other regions.
The sources said that, though rebar trade prices have weakened for the second consecutive week, the market is not sure if a negative price correction will set in for a longer period. A section of traders maintained that integrated mills will continue to increase rebar prices and that cost inflation will keep prices at higher levels, despite protests from key consuming industries.
“Prices have also softened over the past week, as coal prices temporarily eased and secondary mills are attempting to pass on any benefits on the cost side to consumers to revive trading,” an official at Shyam Steel, eastern India’s largest rebar producer, said.
“Our assessment is that the cost of production will still remain on an uptrend, forcing mills to raise prices in April. Consumers need to take a realistic view of how cost structures have changed following global supply chain disruptions, and the protest is not the way forward,” he said.
$1 = INR 75.60
