India: Primary mills likely to hike finish long steel prices for Nov'20

Indian major steel mills are likely to increase finished long steel prices for November deliveries. Rebar and wire rod prices are expected to gain further, as per SteelMint's analysis.

Key factors attributed towards the price hike could be -

• Limited stock at large mills, as per our reliable trade channels.
  
  
• Improved transactions owing to infra projects (Awas Yojna - housing segments, NHAI, Metro etc.) backed by the central government.
  
  
• Initiatives taken by state governments like reducing stamp duty in Maharashtra and proposed hasty land surveys in Telangana for buying properties and some other similar norms by other state governments.
  
  
• With construction activities speeding up, procurement activities have also improved across the regions as the monsoon has almost gone except in the southern region.
  
  
• Appropriate price gap between large and medium/small scale mills' rebar prices, which is hovering at around INR 3,000/t on an average basis in most of the locations.
  
  

Current trade reference rebar prices of 12-32 mm (Fe 500D, BF grade) are reported at INR 39,000-39,500/MT ex Mumbai, excluding 18% GST.

Near term outlook

Market participants shared that primary mills are observing better buying inquiries in finish steel, compared to medium/small scale mills. Prices are likely to remain largely stable, however minor corrections may be seen due to festive holidays.