Structure Prices Drop in the Secondary Market Amid Weak Demand
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The structure market saw price reductions in secondary regions, with Raipur and Chennai dropping by up to Rs 400. Supply constraints continue in the primary market due to maintenance at SAIL’s IISCO plant and shortages of key materials at RINL and JSPL, while the secondary market suffers from weak demand.
Key Insights
- Primary market prices increased: SAIL and RINL raised prices by Rs 750 and Rs 1000 per mt, while JSPL maintained its prices.
- Supply shortages in primary market: Maintenance at SAIL's IISCO plant and material shortages at RINL and JSPL are creating supply issues.
- Secondary market faces declining demand: Despite adequate inventory, weak demand is leading to price reductions across several regions.
Structure Prices
Secondary market downward in all regions; Raipur by Rs 200, Mandi by Rs 300, Durgapur by Rs 300, Hyderabad by Rs 400, and Chennai by Rs 400.
In primary market, new monthly price revision reveals SAIL increased prices by Rs 750/mt, RINL increased prices 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 46,500/mt
Ex-Hyderabad: Rs. 47,600/mt
Ex-Raigarh: Rs 46,500/mt
Ex-Chennai: Rs. 48,600/mt
Ex-Mandi Gobindgarh: Rs. 47,500/mt
Ex-Durgapur: Rs. 44,600/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: Heavy structures like NPB, WPB, and others that are in high demand across India and sold at premium prices based on availability are being supported by the SAIL IISCO Plant, which has been undergoing maintenance. The availability of source materials has become seriously problematic as a result. The single producer in primary, RINL round bars, is now out of stock, although delivery is anticipated next month. It takes two months for orders to be delivered at the JSPL plant, which is also underserved. As a result, a significant problem in the primary segment is supply.
- Secondary: Since secondary mills have adequate inventory of finished goods as well as raw material, they are not concerned about material shortages. There is a scarcity of scrap, but mills have enough billets to make new stock. Together with the slow demand in trade and also construction activity banned by NGT due to pollution, demand is very less in secondary market all over India. The mills are currently experiencing a close-in of inquiries and a slowdown in demand.
Structure News
- China's Ministry of Commerce reported a slight decline in average finished steel prices during November 11-17, with rebar and hot-rolled steel strip prices dropping by 1.0% and high-speed wire rod by 0.9% week-on-week. Meanwhile, coking coal prices fell 0.8%, while smoke-free lump coal and thermal coal prices rose marginally by 0.2% and 0.1%, respectively.
Expert Opinion
- The primary market is expected to remain stable this week; however, in the coming weeks, chances are high for reduced support as the supply issue, currently the main reason behind the strong prices in the market, is likely to be resolved.
Daily Market Report
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