Rebar Prices Touch a 4-year Low in Few Markets

Production of bar and rod (non-alloy steel) increased by 7% in FY15 against FY14. Also, import rose by 190%, as per JPC- Steel Ministry.

Rebar prices in few markets like Raipur, Mumbai and Delhi have dipped to almost a 4-year low. Currently, rebar in Mumbai is trading in the range of INR 30,500-30,700/MT and in Raipur at INR 28,800-29,000/MT for 12 mm (basic price, Excise duty, other taxes extra).

In May’11, prices in Mumbai were hovering in the range of INR 34,000-34,500/MT and Raipur at INR 31,500-32,000/MT for 12 mm (basic price, Excise duty and VAT/CST extra).

Why the fall?

Major fall in prices was seen in the past year owing to weak domestic demand as construction activities were not supportive. Production of bar & rod (non-alloy steel) increased by 7% in FY15 as against FY14. Also, import increased by around 190% during the same period. Together, this led to increase in supply of material in the domestic market. But demand has not been able to keep the pace in line with supply.

Source: JPC- Steel Ministry
QTY in: (‘000 MT)

Looking at the current scenario of imported scrap offers which are almost stable and imported iron ore prices also moving slightly upwards after coming down below USD 50/MT last month, finished steel prices are unlikely to fall below current levels.

Note: 12 mm rebar prices, Excise duty and other taxes extra.