India: Primary Mills Hike Long Steel Prices; Further Increase in Pipeline
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Indian large scale mills - SAIL, JSW Steel, Electro Steel, TATA Steel & RINL (Vizag Steel) have increased rebar prices by INR 1,000-2,000/MT in Dec'19. As per sources, mills are planning to further hike in finished long steel prices for Jan'2020 deliveries.
Following a significant hike in secondary steel prices along with decent export bookings, high global prices mills are expected to hike prices in Jan'20.
As per assessment made by SteelMint, in Dec'19, steel prices by secondary Indian mills have raised by INR 2,000-3,000/MT (USD 28-42) & the global scrap & billet prices rose by USD 20-30/MT.
However, in this duration, the major state owned mills have raised rebar prices by INR 1,000-1,500/MT (USD 14-21), which seems quite less than the rising prices by the other producers.
It was also analyzed that, with the constant rise in secondary steel prices, rebar price gap between the large & medium (secondary) mills have narrowed down to around INR 500-1,000/MT (USD 7-14), which should be not less than of INR 3,000/MT (USD 42), as mentioned by several industry sources.
The demand picked up with large scale mills amidst hike prices by secondary mills. Further if sources are to be believed, primary mills stock level got measured down amid improved supply movement in project works and improved bookings by stockiest on anticipation of further surge in prices in coming months.
Further, improved lending from banks might provide support for steel sector for near term with government support for elongating expenditure figures for infrastructure and allotted specific funds for the completing projects at major regions.
The current offers of rebar by state owned mills reported at near to INR 35,500-36,200/MT ex-Mumbai, INR 35,300/MT ex-Chennai & INR 36,500/MT in Delhi and few private large scale mills prices are on higher range by INR 500/MT.
Meanwhile, the mid scale mills offer learned at INR 34,600-34,800/MT ex-Mumbai, INR 34,600-34,900/MT ex-Chennai & INR 34,400-34,600/MT ex-Delhi. The prices mentioned for 12mm rebar, ex-works & excluding 18% GST.
