Posted on 18 Sep 2024
Domestic rebar prices in India have remained stable on a weekly basis, with no significant changes in the demand-supply situation, notes Kallanish.
In the primary market, the price for 12-32mm IS 1786 Fe 550D grade rebar, produced via the blast furnace route, is assessed at INR 51,000-51,500/t ($607-613) ex-Mumbai.
In the secondary market, the price for 12-25mm IS 1786 Fe 500D grade rebar, produced via the induction furnace route, stands at INR 42,000-42,200/t ($500-502) ex-Raipur.
Demand for rebar in September, traditionally a restocking period, has not yet increased significantly, though it is an improvement over the past two months of July and August, according to market participants.
"Rebar prices have largely remained stable in September so far, in contrast to the price drops observed every week last month. While major restocking is still pending, purchasing activity has been moderate”, notes a Mumbai-based rebar trader.
Another trader adds, "We don’t anticipate a significant rise in rebar demand over the next 15 days due to the Shraddh Paksh period, during which new purchases are typically avoided. Positive buying sentiment is expected to pick up only in October."
The sluggish demand for scrap in key markets such as Turkey, Bangladesh, and Pakistan, coupled with ample stock of DRI, pig iron, and billets, has also caused Indian buyers to adopt a wait and see stance.
Furthermore, reduced funding for government projects and working capital constraints among end-users has further dampened rebar demand in India.
An industry expert from Delhi told Kallanish, "The Indian government’s push for transparency in tax payments through GST has impacted the MSME sector. The strict GST compliance has shifted many transactions from cash to credit, leading to liquidity issues and delayed payments. This shift has affected buyers' ability to pay sellers on time, leading to reduced large-volume purchasing activity."
MSME stands for micro, small, and medium enterprises having an annual turnover up to INR 250 crore ($30 million).
Source:Kallanish
