Nepal’s domestic rebar demand improves, prices firm w-o-w

Domestic rebar offers within Nepal were stable w-o-w. However, demand picked up slightly, which, in turn, eased selling pressure on the local mills.

Rebar offers from standalone mid-sized rolling mills for 10-20 mm currently stand at NPR 81,000-82,000/tonne (t) ($670-678/t). However, the plants which have CCMs (own billet plants) are selling as per needs and on the basis of  payment terms, sources informed.

Factors influencing buyers to take positions

• Because of the higher input costs (sponge iron, billets), mills are being unable to keep viable margins. 
• Dry stock among traders.
• Slight rise in Indian induction furnace (IF)-route steel prices on renewed buying.
• Fluctuating raw material prices globally compared to the constant fall in the last month.

Fresh deals and import offers from India

• Recently, 8,000-10,000 tonnes of sponge iron export deals were reported to Nepal, in which the latest deal, for 100% lumps, was closed at around $410/t, exw-eastern India, equivalent to $435/t CPT Nepal.
• Indian sponge iron exports are likely to rise two-fold in Nepal in the coming months as the country’s steel makers are speedily ramping up billets capacities.
• However, billets demand continues to remains sluggish. The current offers of IF-route billets were reported at around $540-545/t exw-Durgapur, equivalent to $565-570/t CPT Nepal. The offers were firm on w-o-w basis.
• Offers for BF-route billets stood at around $605/t CPT Nepal. However, no fresh deals were confimed, despite the plunge in offers by $20/t, w-o-w.
• Offers for mid-scale mills’ wire rods were stable at $595-600/t exw-Durgapur, equivalent to $620-625/t CPT Nepal.
• Indicative offers for BF-route wire rods remained unaltered at around $715/t CPT Nepal. However, participations remained poor due to cheaper offers of IF route along with better realization in Indian domestic trade deals.