Indian primary mills raise rebars prices by up to INR 1,500/t ($18/t) for early-February sales

Indian primary mills raised list prices of rebars by up to INR 1,500/t ($18/t) for early-February 2023 sales. Following this trade level, prices of blast furnace (BF) route rebars are currently hovering at 8-month high as similar levels were last seen in June last year. Post-revision, effective prices stand at:

• JSW Steel:
  Rebars (12-32mm, IS 1786): INR 63,500-64,000/t ($774-780/t), ex-Mumbai
  Wire rods (5.5-6mm, SAE1008): INR 61,250/t ($749/t), ex-Mumbai
  
  
• Jindal Steel & Power Limited (JSPL):
  Rebars (12-32mm, IS 1786): INR 65,800/t ($802/t), ex-Delhi
  Wire rods (5.5-6mm, SAE1008): INR 62,000/t ($755/t), ex-Delhi
  
  
• ESL Steel:
  Rebars (12-32mm, IS 1786): INR 64,500-64,750/t ($788-791/t), ex-Delhi
  Wire rods (5.5-6mm, SAE1008): INR 62,000/t ($757/t), ex-Delhi
  
  
• Steel Authority of India Limited (SAIL):
  Rebars (12-32mm, IS 1786): INR 63,000-64,000/t ($769-782/t), ex-Mumbai
  Wire rods (5.5-6mm, SAE1008): INR 60,000-61,000/t ($733-745/t), ex-Mumbai
  
  
• Prices are excluding GST at 18%.
  
  

Trade prices of BF-route rebars rose by INR 1,500/t ($18/t) w-o-w to INR 63,500/t ($775/t), exy-Mumbai, excluding GST at 18%.

Factor lending support to increase in prices:

1.Hike in raw material prices: Prices of steel making raw materials like iron ore and coking coal rose recently. National Mineral Development Corporation (NMDC) Chhattisgarh recently hiked iron ore prices by up to INR 500/t ($6/t). Prices of lump ores were raised by up to INR 300/t ($4/t) and fines by INR 500/t ($6/t), effective from 28 January, 2023.

Moreover, the Odisha iron ore fines (0-10mm, Fe 63%) assessed at INR 5,750/t ($70/t) on 28 January, has hit about an eight-month high level. Meanwhile, weekly average prices of imported hard coking coal (premium HCC, Australian-origin) stood at $340/t CNF India for week# 4 (23-28 January), hitting a two-month high, as per SteelMint's records.

The cost push is also encouraging the price hike from mills.

2. Healthy demand in infrastructure and construction: Property registrations in country's largest real estate market, Mumbai, increased by 7% on the year to 8,694 in January 2023, as per data released by Knight Frank India. Also, demand from projects segment has remained healthy last month, and it is likely to continue throughout the quarter as infrastructure and construction projects generally pick up pace during the last quarter of the financial year as they need to stick to completion timelines.

3. IF-route rebars prices: The Induction furnace (IF)-route rebars makers kept their offers on higher side this week despite of need-based buying inquiries and trade activities. IF-route rebars trade prices inched up by around INR 300/t ($4/t) to INR 58,600/t ($715/t), exw-Mumbai as on 2 February 2023, against INR 58,200/t ($710/t) seen last week. It is to be noted that IF-route rebars enjoy 65-70% of the market share in India.

The monthly average gap between BF-IF route rebars has widened to around INR 4,000/t ($49/t) in January, 2023 against INR 3,100/t ($38/t) in December, 2022.