India: IF-route wire rod prices remain range-bound w-o-w in major markets

India's induction furnace (IF)-route wire rod market witnessed a marginal uptick in prices w-o-w. Meanwhile, buying enquiries remained limited at higher offers in the major supplying markets of the central (Raipur) and the eastern (Durgapur) regions of the country.

As per SteelMint's assessment, the wire rod trade reference prices in Raipur market increased by INR 300/t to INR 51,800/t as against INR 51,500/t, while the same in Durgapur market increased by INR 400/t to INR 52,200/t as against 51,800/t as against previous week (till 19 January).

Notably, in terms of IF-route wire rod- Raipur and Durgapur markets are major supplying centres towards the various consuming regions across the country and as per data maintained with SteelMint, cumulative daily wire rod production capacity of these two markets stands at around 20,000 tonnes (t). Apart from that, in Chaibasa (Jharkhand) market, a major supplier has started wire rods production with a daily capacity of 1,000 t which competes with the Raipur and Durgapur markets.

In the Raipur market, some suppliers currently have either halted or adjusted production, and shifted to other commodities in hope of better margins compared to wire rods.

Weekly trade dynamics-

Limited buying enquiries: Wire rod purchase enquiries and trades were limited in the spot market throughout the week as buyers' interest declined at higher offer prices. Need-based buying was observed in the market from distributors' end as deals for around 9,150 t were recorded in Raipur market by SteelMint during the week. However, active lifting and dispatching of previously booked orders reduced the inventory pressure on the suppliers.

Price movement: Wire rod prices moved in an upward direction this week owing to a rise in prices of raw materials as well as semi-finished steel. Also, constant hikes in prices announced by primary mills provided an edge to secondary mill owners to keep prices on the higher side.

Trend in BF-route wire rod: Prices of Blast Furnace (BF)-route wire rod surged in the range of INR 500-1,250/t. Current list prices of wire rods (5.5mm-6mm SAE 1008) stand at INR -

• JSPL- 59,500/t exy Delhi
  
  
• ESL- 60,250/t exy Delhi
  
  
• JSW Steel- 58,250/t exy Mumbai
  
  
• SAIL- 58,000-58,500/t exy Mumbai
  
  

The above-mentioned prices are excluding 18% GST.

Outlook: Given that buyers are hesitant to purchase materials at higher offer prices, the prices of wire rods are anticipated to remain range-bound in the near-term. However, the prices of wire rods may fluctuate according to pricing trends of raw materials.