After a brief stability, the local Indian rebar market has resumed its downtrend, with sellers resuming discounted sales and the majority of large buyers remaining on the sidelines, while a slowdown in implementation has been noticed in large projects, SteelOrbis learned from trade and industry circles on Tuesday, February 6.
India rebar trade prices are down INR 700/mt ($8/mt) to INR 48,000/mt ($578/mt) ex-Mumbai, but are stable at INR47,500/mt ($571/mt) ex-Chennai in the south.
Rebar trade prices have fallen by INR 500/mt ($6/mt) to INR 42,700/mt ($514/mt) ex-Raipur and are down INR 500/mt ($6/mt) to INR 42,700/mt ($514/mt) ex-Durgapur in the east.
According to sources, engineering procurement and construction (EPC) companies are largely seen to be staying away from placing bids and large integrated mills are under pressure from a crunch in relation to funds as the end of the fiscal year approaches, given the slowdown in the pace of large projects, and the rising interest costs of borrowing funds from banks.
“Buyers are avoiding bulk bookings, prompting secondary mills to resume discounted offers to check inventory rises. Retail sales too are slowing at the trade level, with demand very weak in medium and small-scale real estate developments. Also, state governments are strapped for funds, impacting demand from rural and semi-urban development projects,” a Kolkata-based distributor said.
“We hear that secondary mills on average have reduced plant capacity utilizations to levels of 75-80 percent to rein in variable costs, but there is still too much material chasing too little demand,” he said.
$1 = INR 83.10