Structure Market Update: Primary Price Hikes, Secondary Market Slump, and Supply Issues Continue
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Primary structure producers have increased prices, while secondary market prices have declined due to low demand. The supply of heavy structures faces challenges due to maintenance at key plants. The primary market struggles with material shortages, while secondary mills have ample supply but face weak demand across India.
Key Insights
- Primary Price Increases: SAIL, RINL raised prices by Rs 750-1000/mt, while JSPL maintained rates.
- Supply Issues: SAIL IISCO’s maintenance affects supply, and RINL round bars are out of stock. JSPL has a 2-month lead time.
- Secondary Market Slump: Adequate supply from mills but weak demand due to pollution bans construction in north India and low trade activity continued.
- Coal Import Negotiations: JSW and SAIL are negotiating with Mongolia for coking coal, aiming to diversify suppliers.
Structure Prices
Secondary Market: Mandi stable, Raipur down by Rs 200, Durgapur down by Rs 300, Hyderabad and Chennai down by Rs 300.
Primary market: As per new monthly price revision, SAIL increased prices 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 46,300/mt
Ex-Hyderabad: Rs. 47,300/mt
Ex-Raigarh: Rs 46,300/mt
Ex-Chennai: Rs. 48,300/mt
Ex-Mandi Gobindgarh: Rs. 47,500/mt
Ex-Durgapur: Rs. 44,300/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: The SAIL IISCO plant, which has been undergoing maintenance, supports heavy structures like NPB, WPB, and others. These are in high demand throughout India and sold at premium prices depending on availability. As a result, there are now significant issues with source material availability. Although delivery is expected to occur next month, the only producer in primary, RINL round bars, is currently out of stock. The JSPL facility, which is likewise underserved, takes two months to deliver orders. Consequently, supply is a major issue in the primary segment.
- Secondary: Since secondary mills have an adequate supply of both finished items and raw materials, they are not concerned about material shortages. Mills have enough billets to make new stock, despite the lack of scrap. Secondary market demand is very low across India, in addition to the NGT's ban on construction due to pollution and the weak trade demand. The mills are currently dealing with a slump in demand.
Structure News
- JSW Steel and SAIL are negotiating with Mongolian authorities to import coking coal shipments. JSW plans to buy 2,500 mt, while SAIL seeks 75,000 mt. Both companies are exploring transport routes via Russia or China. SAIL aims to diversify its coking coal suppliers.
Expert Opinion
- It looks like the basic supply problem will be fixed because the SAIL IISCO factory is scheduled to start production in the first week of December. Although secondary prices appear to be declining, prices are steady because of the scarcity of scrap.
Daily Market Report
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