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Indian tier-1 mills hike rebar prices by up to INR 2,500/t ($30/t) for early-May'24

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BigMint Bureau

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7 May 2024, 16:59 IST

Indian tier-1 mills hike rebar prices by up to INR 2,500/t ($30/t) for early-May'24

IF-rebar prices rise m-o-m amid active demand

Property registrations up y-o-y in April

Indian tier-1 mills have increased rebar list prices by up to INR 2,500/t ($30/t) for early-May 2024 deliveries over end-April price tags, sources informed BigMint. Current list prices are hovering at INR 58,000-59,500/t ($695-713/t) on landed basis. It shall be noted the mills announced interim price hikes last month and there was a shortage of materials in certain sizes in the market due to maintenance being undertaken by some of the steelmakers at their plants, informed market sources.

Following this, trade-level BF rebar prices increased by INR 1,200-2,000/t ($14-24/t) across markets in the previous week. Rebar prices (12-32mm, Fe500D) in the trade segment increased by INR 1,500/t ($18/t) w-o-w to INR 57,800/t ($692/t) exy-Mumbai as per BigMint's assessment on 3 May 2024. Prices are exclusive of GST at 18%.

In the projects segment, prices were hovering around INR 57,000-57,500/t ($683-689/t) FOR Mumbai. Demand from end-users was need-basis only considering the price volatility.

Factors behind price hike:

1. IF-rebar prices rise in April: Induction Furnace (IF) rebar trade prices surged across markets in April, driven by active demand. In addition, increased prices of imported scrap reduced bookings, which increased reliance on the domestic market, causing shortages and consequent hikes in scrap and other raw materials like sponge iron. The inventory days of IF-mills were around 5-7 days in April and there were no inventory pressure as good bookings were observed in the market. IF-rebar trade prices rose by INR 3,000/t ($36/t) m-o-m to average of INR 49,400/t ($592/t), exw-Mumbai in April as against INR 46,400/t ($556/t) in March 2024. It must be noted that IF-based mills command 65-70% share in rebar market.

The gap between BF-IF rebars widened m-o-m to INR 5,500-6,000/t ($66-72/t) in May as compared with INR 4,000-4,500/t ($48-54/t) in the previous month as tier-1 mills announced interim price hike in rebar prices in April.

2. Property registrations up y-o-y in April: Property registrations in the country's largest real estate market, Mumbai registered an 11% rise y-o-y to 11,628 units in April 2024 as compared with 10,514 units in the same period last year, as per data released by Knight Frank India. Meanwhile, registrations dropped 18% m-o-m against 14,145 units in March 2024.