- ERW pipe prices rise, but demand remains subdued
- Rising HRC costs support further price increases
A major Indian producer of electric resistance welded (ERW) pipes has increased its mid-September list prices twice for round pipes by a total of INR 2,000/t ($21/t) across key markets, effective 15 September. The revision follows a INR 1,000/t ($10/t) increase on 8 September and reflects higher hot-rolled coil (HRC) costs, while raw material availability has also tightened, market sources said.
The revised list prices for base-grade round pipes of 25-125 NB and 2.2-6 mm thickness stand at INR 65,500/t ($685/t) exy-Raipur, INR 67,500/t ($706/t) exy-Pune, excluding 18% GST.
However, market acceptance of the hikes remains limited amid subdued demand. A market participant said, “The market is unable to absorb the price hikes from mills, as demand has not improved yet, leading to inventory build-up.”
Another market participant noted, “Buyers had already anticipated further price increases following the rise in raw material prices at the beginning of the month.”
Distributor prices edge higher
Distributor-level ERW pipe prices also escalated in early-September, although demand remained moderate-to-good in the market.
In Raipur, monthly average prices increased by INR 1,700/t ($18/t) m-o-m to INR 63,800/t ($668/t) as on 9 September from INR 62,100/t ($650/t) in the August month.
In Pune, monthly average prices increased by INR 1,300/t ($13/t) m-o-m to INR 64,900/t ($679/t) as on 9 September from INR 63,600/t ($666/t) in the August month.
Market shows mixed trends across regions
While regions experiencing lower rainfall reported an improvement in demand, other markets saw limited recovery on the demand side. In the south, demand remained weak at the distributor-to-dealer level, despite regular supply. Inventories were also reported to be on the higher side.
A market participant noted that primary steel prices have increased sharply, and it will take some time for the revised rates to be absorbed by the market. Meanwhile, dealers holding lower-priced inventories purchased at earlier rates are selling below the new replacement levels, amid subdued demand.
“In the West”, a market participant said, “demand has also increased due to seasonal factors, such as the receding monsoon and the onset of the festive season, which are supporting structural fabrication and construction activity.”
HRC costs support higher pipe prices
BigMint’s bi-weekly HRC benchmark for IS 2062, E250, 2.5-8 mm CTL jumped by INR 3,300/t ($35/t) m-o-m to INR 61,900/t ($648/t) exy-Mumbai in September from INR 58,600/t ($613/t) from average in the previous month.
HRC prices have also surged in the week on rising raw materials costs (coking coal) and as mills raised prices and spot availability tightened for some grades and sizes. Buying improved, mainly from downstream users, while mills reduced supplies to traders by focusing more on automotive and B2B customers. However, buyers remained cautious and mostly purchased only for immediate needs. Overall, rising raw material cost, higher mill prices, better buying and tighter supply supported HRC prices, though weak overall demand limited further gains.
Outlook
In the near term, the market is expected to remain volatile, with prices likely to witness further fluctuations. Market participants anticipate additional price increases in the month from producers, while demand remains subdued and has yet to show a meaningful improvement. As a result, buyers are largely adopting a wait-and-watch approach, limiting fresh inventory purchases and focusing primarily on immediate procurement requirements. This cautious buying sentiment is expected to keep market activity measured in the near term.
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