India: BF-route rebars trade prices remain rangebound w-o-w

Trade level prices of rebars made through blast furnace (BF) -route dropped marginally by INR 200/t ($2/t) w-o-w in the key market of Mumbai. Current prices stood at INR 62,600/t ($756/t), exy-Mumbai as per the assessment on 24 February 2023. Prices are excluding 18% GST.

Factors keeping prices rangebound

1. Raw material prices: Prices of steelmaking raw materials like iron ore fines remained stable w-o-w. Meanwhile, coking coal prices increased during the week.

SteelMint's weekly Odisha iron ore fines Fe 63% index remained stable w-o-w at INR 5,750/t ($69/t) ex-mines as on 18 February, 2023. Prices increased by INR 650/t ($8/t) against INR 5,100/t ($62/t) seen during the first week of January.

The weekly average prices of Australian-origin premium hard coking coal (HCC) inched up by $20/t w-o-w to $396/t CNF India for the week ending 18 February 2023. Prices increased by around $80/t from $315/t CNF India in the first week of January.

2. IF-route rebars prices: The IF-route rebars trade prices showed mixed trends across major markets. Prices remained rangebound at INR 56,500/t ($683/t) w-o-w exw-Mumbai, as compared with similar levels seen a week ago. Secondary steel manufacturers kept their offers on hold amid slow demand as fresh bookings are very limited and deliveries for old bookings are going.

The gap between BF-IF route rebars stood at INR 6,000-6,500/t ($72-79/t) in the key market of Mumbai. It may be noted here that this gap was around INR 3,000-3,500/t ($36-42/t) in the preceding month, which has shifted interest of end-users towards IF-route rebars.

3. Infrastructure and construction demand: Demand from infrastructure and construction segment remained healthy in the begining of the current quarter (Q4FY'23) as companies need to meet their yearly completion targets and this being the last quarter of the fiscal year.

Property registrations in country's largest real estate market, Mumbai, increased by 7% on the year to 8,694 in January 2023, as per data released by Knight Frank India.

Furthermore, primary mills are likely to announce prices for March deliveries in the upcoming week and market participants are awaiting for the same. Meanwhile, bookings for BF-route rebars in the projects segment seemed to be less active currently as these were done earlier this month.