IISCO Plant Maintenance and Supply Shortages Impact Structure Steel Market

Key Highlights

• Primary Market Prices: SAIL up by Rs 750/mt, RINL by Rs 1000/mt, and JSPL holds prices steady this month.
• Supply Shortages: IISCO plant maintenance limits heavy structure availability, leading to high demand and premium pricing.
• Secondary Market Stability: Secondary mills hold steady inventory for standard sizes but face slow trade demand and potential declines from iron ore price drops.
• Steel Imports Rise: India’s steel imports rose by 40% year-on-year; domestic production grew by 4%.

Structure Prices

• Secondary Market: Stable in all regions.

• Primary market: New monthly price revision shows SAIL increased price by Rs 750/mt, RINL increased price by Rs 1000/mt and JSPL rates are rollover in this month.

• The offers for 100 x 50 Channel in the Secondary Steel market are as follows:

• Ex-Raipur: Rs 47,500/mt

• Ex-Hyderabad: Rs. 49,100/mt

• Ex-Raigarh: Rs 47,500/mt

• Ex-Chennai: Rs. 50,000/mt

• Ex-Mandi Gobindgarh: Rs. 48,800/mt

• Ex-Durgapur: Rs. 46,300/mt

• The offers for 100 x 50 Channel in the Primary Structural Steel market are as follows:

• Ex-Durgapur: Rs. 55,250/mt

• Ex-Chennai: Rs. 58,750/mt

• Ex-Hyderabad: Rs. 57,250/mt

• Ex-Ahmedabad: Rs. 57,750/mt

• Ex-Ghaziabad: Rs. 55,750/mt

Structure Supply and Demand

• Primary: In primary market, supply is a major issue now. This is because IISCO Plant has now been undergoing maintenance for 45 days where heavy structure is manufactured like NPB, WPB, etc. that are in high demand pan India and selling at a premium rate. To help with the supply issue, the RINL factory has already started up again. Furthermore, it is the sole manufacturer of round bars without any in stock at the moment, though they should be delivered next month. The JSPL segment also faces shortage in market. Thus, a fundamental problem in the primary segment is supply.
• Secondary: Secondary mills have adequate inventory for standard sizes, so they are not concerned about material shortages. With the price of iron ore in China declining, the secondary market's potential will also decline in a few days. There are inquiries on the secondary market, however there are closure issues because of the high prices. Mills are under pressure to close orders. The secondary market trade demand is also slow.

Structure News

• India remained a net steel importer from April to October in FY 2024-25, with imports rising 40% year-on-year to 5.71 million mt, while exports totalled 2.75 million mt, as per provisional steel ministry data.
• October 2024 imports were 0.98 million mt, up 34% from last year but down 4% from September, partly due to stricter quality controls. Steel exports rose 11% month-on-month to 0.44 million mt, while domestic steel production increased 4% year-on-year to 82.65 million mt.

Expert Opinion

• This month, JSPL rolled over the rates, and SAIL and RINL raised their pricing by Rs 750 and Rs 1000/mt, respectively. Due to the 45-day maintenance period at the IISCO facility and the severe lack of plant supplies for heavy sections that are sold at premium prices, there is a supply issue. RINL round bars are also not available in the market. Due to the inaccessibility of certain crucial structural components, the price of the JSPL sector also experienced a significant increase last month. The RINL facility has reopened to assist with the structural necessity.
• Although trade demand is still declining, secondary market prices are increasing as a result of a shortage of raw materials.