Trade-level blast furnace (BF) rebar prices declined by INR 800-1,200/t ($10-14/t) during the week across markets owing to sluggish domestic demand. Current rebar prices (12-32mm, Fe500D and Fe550D) in the trade segment have dropped by INR 1,000/t ($12/t) w-o-w to INR 56,300/t ($675/t) exy-Mumbai. Prices are exclusive of GST at 18%.
In the projects segment, prices are hovering at INR 55,500-56,500/t ($666-678/t) on landed Mumbai basis. Buyers remained on the sidelines amid decline in prices and were cautious in making purchases which kept demand largely need-based. Furthermore, they are waiting for mills’ prices for July dispatches.
Factors behind decline in prices
1. IF-rebar prices decline w-o-w: Induction furnace (IF) rebar trade prices continued to show a downtrend since the last four weeks. Prices have bottomed out to nearly 4-month lows as similar levels were previously seen in early-March this year. Demand was subdued this week, while trading activities improved slightly as buyers procured limited volumes at lower price levels. The inventory days of IF-rebars have been hovering at 12-15 days across markets. Prices of raw materials and semi-finished steel, sponge iron and billets have also witnessed a downtrend. For instance, BigMint’s billet index, exw-Raipur, dropped to nearly a 3-month low in the preceding week. Trade-level IF-rebar prices declined w-o-w by INR 700/t ($8/t) to INR 48,900/t ($586/t) exw-Mumbai as on 28 June 2024.
The gap between BF-IF rebars widened further this month to around INR 6,500-7,000/t ($78-84/t) in June as compared to INR 5,000-5,500/t ($60-66/t) in the preceding month.
2. Raw material prices drop w-o-w: Prices of key steel-making raw materials — iron ore fines and coking coal — dipped w-o-w. BigMint’s weekly Odisha iron ore fines Fe62% index dropped w-o-w by INR 500/t ($6/t) to INR 4,800/t ($58/t) ex-mines as on 22 June. Prices dropped to one-month low levels and no deals were recorded in fines as buyers focused on the OMC iron ore auction.
Similarly, Australian premium hard coking coal (PHCC) prices dropped on the week by $18/t to $256/t CNF Paradip as against $274/t CNF Paradip in the previous week. Prices have fallen due to sufficient supplies in the market.
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