India: BF rebar trade prices drop w-o-w amid weak demand

• IF rebar prices drop w-o-w
  
  
• Iron ore, coking coal prices edge down
  
  

Trade-level blast furnace (BF) rebar prices declined on a weekly basis amid subdued domestic demand and liquidity crunch impacting market sentiments. Major mills have offered discounts on list prices this month, BigMint learnt from market sources. Trade-level blast furnace (BF) rebar prices edged down w-o-w by INR 100/t ($1/t) to INR 54,000/t ($638/t) exy-Mumbai, as per BigMint's assessment on 29 November 2024. Prices are exclusive of GST at 18%.

In the project segment, prices were hovering around INR 53,000-54,000/t ($626-638/t) FOR Mumbai. Prices dropped w-o-w amid slow buying interest from end-users. "The Commission for Air Quality Management's (CAQM) Stage IV of Graded Response Action Plan (GRAP) ban on construction due to severe air quality in the National Capital Region (NCR) has delayed the housing and commercial projects, restricting construction activities," said a source.

Update on project orders

Kalpataru Projects International (KPIL) has secured new orders worth INR 1,114 crore. The orders have been secured for transmission and distribution (T&D) business in Middle East and Americas. In the Railways segment, an order was secured for Metro Overhead Electrification (OHE) works in the technologically enabled segment in India. In addition, the business has secured orders for supply of various types of cables in India and overseas

The company has also secured significant orders of worth INR 1,704 crores in its T&D business for Design, Supply and Installation of 765 kV Transmission Lines and GIS Substations from Power Grid Corporation of India Limited (PGCIL).

Factors behind market dynamics

1. IF rebar prices fall w-o-w: IF-rebar fell on weekly basis amid slow buying activities across major markets during the week. Lifting of material was slow which made manufacturers to reduce list prices and offer discounts to liquidate material. In addition, liquidity crunch issues were prevailing in the market which weighed on the market sentiments. Inventory idling time remained high at 12-15 days across markets. IF-rebar trade prices declined by INR 1,100/t ($13/t) w-o-w to INR 46,600/t ($551/t) exw-Mumbai.

The price gap between BF-IF rebars stood at around INR 7,000-7,500/t ($83-89/t) in the Mumbai market. Notably, IF rebars enjoy a 65-70% share of the market.

2. Raw material prices dip marginally: BigMint's weekly Odisha iron ore fines Fe62% index dipped INR 50/t ($0.6/t) w-o-w to INR 5,300/t ($63/t) ex-mines on 23 November. Odisha's iron ore market showed mixed trends after OMC's auction. Buyers await upcoming price announcements from private miners. Deals remained muted as buyers purchased material from OMC's auction while remaining cautious about the private miners' prices going ahead.

Australian premium hard coking coal (PHCC) prices edged lower by $2/t w-o-w to $220/t CNF Paradip.

Outlook

Market participants have been cautious in purchasing and are waiting for price clarity from the mills for next month.