Primary Structure Supply Strengthens as Secondary Market Prices Rise Amid Rising Demand

Key Takeaways

• Price Trends: Secondary market prices show increases in key regions, while primary players like SAIL and RINL cut prices this month.
• Supply Recovery: Primary markets address heavy structural material shortages, with distributors restocking and RINL round bars back in circulation.
• Secondary Market Strength: Ample supply and government duties boost secondary market momentum, although demand remains constrained.
• Tata Steel Compliance Issues: Tata Steel’s Dutch plant faces potential closure over environmental non-compliance, posing risks to European operations.
• Market Outlook: Secondary markets exhibit upward trends due to policy impacts, while primary markets see contracting prices amidst evolving demand.

Structure Price

• Secondary Market: Raipur and Durgapur stable, Mandi up by Rs 200, Hyderabad and Chennai up by Rs 300.

• Primary market: In this month’s price revision, SAIL reduced prices by Rs 500/mt, JSPL rolled over the rates and RINL decreased prices by Rs 700/mt.

• Current base prices:

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

• Ex-Raipur: Rs 46,300/mt

• Ex-Hyderabad: Rs. 47,900/mt

• Ex-Raigarh: Rs 46,300/mt

• Ex-Chennai: Rs. 47,700/mt

• Ex-Mandi Gobindgarh: Rs. 47,700/mt

• Ex-Durgapur: Rs. 44,800/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: The SAIL IISCO facility is up and running right now. Heavy structural materials, which are currently hard to find in India, might become easier to get as a result. Stocks are now being sent to distributors, and supply issues are being fixed. Additionally, merchants are now selling the RINL round bars that were previously unavailable and have supply of round bars.
• Secondary: Secondary mills don't have to worry about shortages of completed items because they have ample supply on hand. However, there is limited demand.

Structure News

• Tata Steel’s Dutch plant faces a deadline from regulators to reduce pollution at its coke oven within a year or risk closure. The oven has been violating environmental regulations, and failure to comply may lead to the revocation of its operating license. Tata claims closing the oven would jeopardize the entire plant, which is a major greenhouse gas emitter in the Netherlands.

Expert Opinion

Due to rising demand and the effect of government-imposed import duties, the secondary market appears to be on the rise while the main market appears to be contracting.