As per SteelMint assessment, rebar price gap between the large & medium/small scale mills is currently hovering at INR 5,000-7,000/MT (USD 68-95), increased as against Sep’18 at INR 3,500-4,000/MT (USD 47-54), considering Delhi/NCR & Mumbai location.
The prime reason behind widening price gap between the producers are rally prices by large mills, which recorded a hike of INR 500-1,500/MT in the beginning of Oct’18 on account of higher input costs due to surge in Iron ore & Coking coal prices.
However in the same duration, rebar prices by medium/small mills in South, West & Central regions have decreased by about INR 1,500-2,500/MT due to poor off take owing to festive season, whereas in Delhi/NCR it was more or less stable.
Currently in Mumbai – large mills are offering rebar at INR 44,000-44,500/MT, while offers through the medium/small scale mills stood at INR 36,600-37,000/MT. The prices are for 12-25 mm size, ex-work & excluding GST at 18%.
Similarly in Delhi – the large mills are offering rebar at around INR 44,500-45,000/MT, although the offers by medium & small scale mills hovering at INR 39,200-39,400/MT for the same size material.
What May Happen?
As per the market participants, trade activities in rebar market are likely to remain quite less particularly where assembly elections are held during Nov-Dec’18 and following are the states where the elections are scheduled – Chhattisgarh, Madhya Pradesh, Telangana & Rajasthan.
Meanwhile rumours are strong about further increase in long products prices by the large scale mills by INR 500-1,000/MT in starting of Nov’18.
Also the participants believed that, Medium/small mills to follow suit in coming days as demand to gradually pick in rest of markets post the Diwali festival due to peak season for construction activities and bottomed out current prices.
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