BigMint's India steel index drops w-o-w on rising inventory, weak construction activity

• Rebar prices drop as state elections hit construction activity
  
  
• Scheduled maintenances may reduce HRC supply, support prices
  
  
• HRC domestic-import price differential stays above INR 6,000/t
  
  

Morning Brief: BigMint's flagship India steel composite index, a barometer of the domestic steel market, edged down by 0.7% w-o-w on 8 May 2026, as long steel prices in the domestic market came under pressure due to a slowdown in construction amid elections in many states and the piling up of inventory.

In comparison, flat steel prices remained supported, thanks to hikes announced by mills. However, the sustained rally in domestic prices following the outbreak of the Iran conflict in end-February has definitely come to an end.

This explains why despite NMDC raising iron ore prices recently and despite coking coal prices holding firm, domestic steel prices are still under pressure. While the flats index was largely flat w-o-w, the longs index witnessed a decline of 1.3% w-o-w.

Highlights of price movements

IF rebar prices weaken across regions: W-o-w, induction furnace (IF) rebar prices declined by INR 400-1,500/t across key regions. Trade prices declined across markets on subdued demand and cautious sentiment. Weak downstream demand and slower construction activity pressured market sentiment, prompting mills to lower their prices and offer discounts to support sales and clear inventories.

Buying was mostly need-based, while slower fresh bookings led to inventory accumulation, with stock levels rising to around 10-12 days.

Soft demand weighs on BF rebar: Trade-level BF-rebar prices (distributor to dealer) dropped by INR 300/t ($3/t) to INR 59,400/t ($624/t) exy-Mumbai as on 5 May. The primary steelmakers rolled over rebar list prices for early-May dispatches over end-April. Rising inventorylevels and weaker offtake prompted the mills to extend price support on list prices.

In the projects segment, demand was relatively weak, with limited inquiries and slower procurement cycles. Construction activity was impacted by election-related labour shortages, leading to execution delays and deferred purchases. Price volatility and overall market uncertainty prompted buyers to adopt a cautious approach. Rebar inventories at tier-1 mills rose by over 40% m-o-m in early-May, as per sources.

The BF to IF rebar price spread in Mumbai widened to around INR 10,500-11,000/t ($110-116/t) last week. IF rebar continues to dominate the market, accounting for an estimated 65-70% share.

Mills hike HRC, CRC list prices: BigMint's bi-weekly benchmark assessment for HRC (IS2062, Gr E250, 2.5-8 mm/CTL) increased by INR 900/t w-o-w to INR 58,700/t on 8 May compared to INR 57,800/t on 1 May. CRC (IS513, Gr O, 0.9 mm/CTL) prices were assessed at INR 65,500/t, a w-o-w increase of INR 300/t from INR 65,200/t.

Leading steelmakers revised their list prices upward for early May 2026, raising both HRC and CRC prices by INR 1,000/t ($11/t). However, one mill opted to roll over its prices, keeping them unchanged from the previous cycle.

The price uptick was driven by scheduled maintenance shutdowns at key steel mills. These planned outages are expected to temporarily constrain HRC production by approximately 10-15% in the near term. With supply tightening ahead of the maintenance shutdowns, mills have moved proactively to revise prices upward, seeking to manage order books and protect margins.

However, persistent labour shortage and a visible slowdown in construction dampened buying interest. Although the latest round of price hikes prompted a rise in offer levels in select markets, the demand-side picture remains unclear, leaving participants hesitant to commit to fresh purchases.

Notably, despite the surge in bulk HRC imports in April, the differential between domestic HRC and landed imports continues to hover above INR 6,000/t. Therefore, pressure from imports is not weighing on the domestic flat steel market but demand remains soft.

Outlook

Maintenance downtimes announced by mills will curtail HRC output in the coming days and, therefore, prices may remain supported. A fresh round of restocking in May is still awaited. Longs prices too seem to be wilting; so mills may try to inject some buoyancy in the market by raising prices marginally. However, any major improvement in demand is not expected.