With significant fall in prices the Indian re-rollers are pressurized over low off-take for the materials. This has resulted in gradual increase in inventory levels with the manufacturers.
Looking at situation, few manufacturers in various regions of India have opted for an option to cut their productions for long steel especially for rebar.
The major production cut is reported in Chennai, Southern and in Gujarat, Western Regions.
An official from Shakti Ferro, Chennai with rebar production of around 1,000 MT per day stated that “we have cut the production upto 60% due to the dead demand in the local market as there are no new projects upcoming and so very minimal inquiries”.
Similarly, the manufacturers in Durgapur, Eastern India & Raipur, Central region reported heavy stock with them for approximately 10-15 days over weak demand since long days. However, they are not ready to reduce productions; expecting prices stability.
A Gujarat based source mentioned about decrease in operations from earlier 20-24 hrs to 12-14 hrs, the plants name mentioned by sources are – KB Ispat, Narmada Concast, Vinayak Steel and Haq Steels.
Notably, in Apr’17, India’s crude steel production has also declined by 2.7% and was registered at 8.11 MnT compared to 8.27 MnT in Mar’17.
It seems that the manufacturers in other key markets like in Central & Western regions (Maharashtra) may follow the suit to reduce their stocks as well to maintain demand supply chain.
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