Key electric resistance welded (ERW) pipe manufacturers are likely to raise list prices by INR 500-1,000/t ($7-13) on the back of rising costs of hot-rolled coils (HRC) prices.
A pipe distributor from Raipur told SteelMint,: “APL Apollo Tubes is likely to announce another price hike of around INR 500/t ($7/t) during the first week of Aug’21. However, there is subdued demand and slow recovery in the market.”
“The mill is planning to raise list prices by INR 1,000/t ($13/t) during the first week of next month, on account of rising costs of pipe-making raw material, hot-rolled coils. However, buyers have become very price sensitive owing to poor demand in the domestic market,”a distributor from Tata Tubes based in Delhi informed.
At present, Tata Tubes is reported to be booking coil-based pipes at INR 68,000-68,500/t ($914-921/t), ex-Jharkhand, for Jul’21 deliveries, compared to the last revised price in early–July which stood at INR 70,000/t ($941). Prices do not include GST at 18%.
The current trade offers for base grade ERW pipes (25-125 NB, 2.2-6 mm thickness) are assessed at INR 67,500/t (exy-Delhi), INR 67,750/t (exy-Pune) and INR 65,500/t (exy-Raipur). Prices do not include GST @ 18%.
Domestic HRC trade prices rebound
Domestic HRC trade prices increased this week as traders resumed buying on expectation of a price hike in Aug’21.The announcement of an export tax from China and better realisation in exports led to increased prices in the trade segment. Mills may either hike prices in August by INR 500-1,000/t or announce a rollover to improve buying in the domestic market.
SteelMint’s benchmark price assessments of 2.5-8 mm IS 2062 hot-rolled coils (HRC) increased by INR 1,400/t to INR 65,000-66,000/t exy-Mumbai as compared to INR 64,000-65,000/t seen a week ago. The prices mentioned above are exclusive of GST @18%.
Demand in real estate strong in H1 FY’22
Despite the second wave of Covid-19, housing sales rose 67% y-o-y during June’21 to 99,416 units across eight prime cities on account of good demand primarily in Mumbai and Pune markets, according to Knight Frank India.
Owing to the gradual resumption of economic activity, new launches of residential properties and home sales across the top real estate markets were 71% higher in the first half of 2021.
Housing demand in the country has revived, however, a surge in Covid-19 cases may derail real estate from recovery.
“Amid a dramatic spike in the number of new coronavirus cases in India, demand for residential real estate might be thrown off track,” said head of industry body CREDAI.
Near-term outlook
Although credible market sources have indicated a possible uptick in the ERW HR coil-based pipe prices, it would be interesting to see the pricing strategy pipe manufacturers will adopt in Aug’21 given the slow pipe demand in the domestic market.
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