Local Indian rebar market has shifted firmly on to a downward trend with prices losing ground in reaction to induction furnace operators lowering prices and distributors across regions opting for discounted sales to check inventory increases, SteelOrbis learned from trade and industry circles on Tuesday, December 3.
Sources said that rebar trade prices have lost INR1,100/mt ($13/mt) to INR 46,500/mt ($549/mt) ex-Mumbai and are down INR 300/mt ($4/mt) to INR 46,000/mt ($543/mt) ex-Chennai in the south.
Rebar prices have moved down by INR 800/mt ($9/mt) to INR 41,400/mt ($489/mt) ex-Raipur and have also declined by INR 800/mt ($9/mt) to INR 40,200/mt ($475/mt) ex-Durgapur in the east.
According to sources, large integrated mills and induction furnace operators have all been reporting a rise in inventories, with large buyers including engineering, procurement, construction (EPC) companies continuing to stay away from concluding bookings, forcing these producers to lower their ex-mill prices.
At the same time, dealers largely dependent on retail sales and smaller users in real estate have also been saddled with higher-than-average inventories and have been forced to push discounted sales to maintain cash flows and liquidity.
“The rebar market has failed to sustain at higher levels simply because of the fundamental demand weakness in key sectors like construction, real estate development and lower government spending on rural and semi-urban infrastructure. These are reflected in disappointing macro-economic indicators,” a Kolkata-based distributor said.
“Stock movement from mills to the market is very slow. Both producers and dealers have no option but to play on the price to keep sales going,” he said.
$1 = INR 84.70