Structure Market Update: Prices Decline in Secondary Market

Key Takeaways

• Price Fluctuations: Raipur, Mandi, and Durgapur experience declines of up to Rs 500, while primary manufacturers raise prices significantly due to material shortages.
• Supply Concerns: RINL's material scarcity is impacting primary market supply, although the facility has restarted operations.
• Secondary Market Stability: Secondary mills are adequately stocked for conventional sizes, but small mills face raw material shortages.

Structure Prices

• Secondary Market: Raipur down by Rs 500, Mandi down by Rs 200, Durgapur down by Rs 500. Hyderabad and Chennai are stable.

• Primary market monthly price revision: SAIL increased prices by Rs 2000/ton, VSP increased by Rs 1000-1500/ton and JSPL increased UB/UC sections by Rs 1000-1500/ton and lower sections by Rs 2500/ton.

• Prices for secondary structures are as follows (Channel 100x50)

• Ex-Raipur: Rs 47,400/ton

• Ex-Hyderabad: Rs. 49,400/ton

• Ex-Raigarh: Rs 47,400/ton

• Ex-Chennai: Rs. 50,100/ton

• Ex-Mandi Gobindgarh: Rs. 48,900/ton

• Ex-Durgapur: Rs. 46,400/ton

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

• Ex-Durgapur: Rs. 54,500/ton

• Ex-Chennai: Rs. 58,000/ton

• Ex-Hyderabad: Rs. 56,500/ton

• Ex-Ahmedabad: Rs. 57,000/ton

• Ex-Ghaziabad: Rs. 54,500/ton

Structure Supply & Demand

• Primary: The primary reasons for India's severe RINL material scarcity are the planned shutdown of the facility and the ensuing halt in operations. However, the RINL facility is currently operating again, albeit slowly, and some sections have already entered the market, which will help with the supply deficit. It is also the sole manufacturer of round bars that are currently unavailable. In many places, large structural sections are rare, even when they are absolutely necessary. The supply is being significantly impacted by the present material scarcity. The restart of the RINL facility will assist because SAIL is unable to meet the enormous demand for structural steel. As a result, a significant problem in the primary segment is supply.
• Secondary: Secondary mills have enough inventory for conventional sizes, so they are not concerned about finished material shortages. However, small mills are experiencing a lack of overstocks and a shortage of raw materials due to the difficulties in locating billet. The current lacklustre demand in the trade industry is causing prices to decline.

Structure News

• In a significant move to expand its global presence, Jindal Group is in talks to acquire a 100% stake in Czech-based Vitkovice Steel for approximately 150 million euros (around Rs 1,000 crore). This acquisition, expected to be finalized by the end of the fiscal year, will mark Jindal Group's first entry into the European market.

Explore more industry updates and steel structure news here!

Expert Opinion

• Due to external circumstances, all the major manufacturers have increased their prices this month. SAIL prices have increased as a result of a shortage of plant supplies.
• RINL Round bars are hard to find and highly sought for. Due to the inaccessibility of certain major structural elements, the JSPL segment's price has also gone up this month. In order to help satisfy the structural need, the RINL facility has resumed operations.
• Secondary market prices fall as a result of decreased demand brought on by slow secondary market trading.