India: BF-route rebar trade prices edge down w-o-w amid weak demand

Trade level prices of blast furnace-(BF) route rebars followed downward trend across major markets amid weak domestic demand. Current rebar prices in the trade segment edged down by INR 200/t ($2/t) w-o-w to INR 51,000/t ($622/t), exy-Mumbai, as per SteelMint's assessment on 21 July, 2023. Prices exclude GST at 18%. This has been the 24th consecutive week of drop in trade prices, as per SteelMint records.

Factors weighing down prices:

1. Prices of raw materials drop: Prices of key steelmaking raw material, iron ore fines (Fe 62%) and coking coal edged downwards w-o-w.

SteelMint's weekly Odisha iron ore fines Fe 62% index dropped by INR 100/t ($1/t) w-o-w to INR 4,700/t ($57/t) ex-mines as on 15 July. The absence of active trades and fall in sponge prices have kept fines prices under pressure.

Australian premium hard coking coal (HCC) prices inched down by $2/t w-o-w to $241/t CNF Paradip as against $243/t last week due to muted trading activities.

2. Dull demand weighs on IF rebar prices: Induction furnace-(IF) route rebar trade prices fell by INR 800/t ($10/t) w-o-w to INR 46,300/t ($565/t), exw-Mumbai as on 21 July. Manufacturers lowered their prices and also offered trade discounts as buying inquiries were very limited. Demand in the finished steel remained dull due to heavy rains across markets.

The monthly average spread between BF-IF rebars widened to around INR 3,500-4,000/t ($43-49/t) in July as against INR 2,500-3,000/t ($30-37/t) seen in the preceding month.

3. Global steelmakers reduce prices: Chinese steelmaker, Shagang Steel, has reduced rebar prices by RMB 100/t ($14/t) for late-July sales. Post-revision, effective prices of rebar (16-25 mm) were at RMB 3,870/t ($539/t) ex-mill, including VAT.

4. Slow demand from projects: Rebar offers in the projects segment were heard around INR 48,500-49,500/t ($591-604/t) FOR Mumbai. Buying interest remained weak amid urgent requirement basis procurement coupled with seasonal disruptions caused by heavy rains across major markets, which has been weighing down the prices.

Click here for brand wise rebar offers