Trade level blast furnace (BF) rebar prices remained range-bound across markets this month. On weekly basis, prices witnessed an uptick across some markets amid moderate buying activities over the week. A private steelmaker raised prices by INR 500/t ($6/t) earlier this week, sources informed. This week’s rebar prices (12-32mm, Fe500D) in the trade segment rose by INR 300/t ($4/t) w-o-w to INR 52,700/t ($632/t) exy-Mumbai. Prices are exclusive of GST at 18%. In the projects segment, prices were hovering around INR 50,000-50,500/t ($600-606/t) landed Mumbai basis.
Factors behind market dynamics:
1. BF-rebar prices supported: BF-rebar trade prices remained supported for the past couple of weeks as mills opted for production cuts due to mounting inventories at their yards and announced interim price hikes. However, demand from end-users remained subdued due to liquidity issues dampening market sentiments. Additionally, there was a slight improvement in activities this week focused on clearing Memorandum of Understandings (MoUs) as the financial year draws to a close. Moreover, the liquidity crunch is expected to worsen next month with elections approaching.
2. IF rebar prices stay range-bound: Induction Furnace (IF) route rebar trade prices stayed range-bound on weekly basis amid limited procurement from buyers post-Holi reopening. Trades occurred at lower price levels, yet manufacturers aimed to raise prices due to improved buying activities. Current IF-rebar trade prices were assessed at INR 49,100/t ($589/t), exw-Mumbai. It must be noted that IF-based mills command 65-70% share in rebar market.
The gap between BF-IF rebars stood at INR 2,500-3,000/t ($30-36/t) in March as against INR 3,500-4,000/t ($42-48/t) in the previous month.
3. Infra, construction project orders: The infra and construction companies have bagged the following project orders:
- Larsen & Toubro’s (L&T) Building & Factories Business secured the contract to construct the Al Namaa General Hospital from the Ministry of Health, Sultanate of Oman. The scope of work includes construction of a 165 bed hospital building (G+4) including basement and ancillary buildings.
- Larsen & Toubro (L&T) GeoStructure secured an order from Paradip Port Authority (PPA), to construct a South Breakwater Extension, Groynes and a Breakwater Toe Protection Wall at Paradip Port, Odisha.
- Kalpataru Projects International Limited (KPIL) and its subsidiaries have secured new orders worth INR 2,071 crores. Orders in Transmission & Distribution (T&D) business in the overseas markets while order for design & construction of an underground metro rail project in India.