- Rebar prices rise as inventories decrease
- HRC market stagnates amid weak demand
- HRC imports continue but exports struggle
Morning Brief: BigMint’s Steel Composite Index remained range-bound against the previous week, gaining by a mere 0.3% to settle at 129.7 points on 14 February 2025. The index continued to make slow recovery, primarily on the back of a buoyant induction furnace (IF) rebar market.
Accordingly, among the sub-indices, steel longs notched a 0.6% uptick, fuelled by a 0.7% increase in both rebars and structure steel. Meanwhile, flats edged down by 0.1%, triggered by a 0.3% drop in hot-rolled coils (HRCs), though the other categories were either flat or trended higher.
Factors impacting index last week
IF rebar demand picks up: The IF rebar trade segment gained momentum, boosted by (1) an improvement in demand, though it was still relatively moderate, (2) a reduction in inventory idling time, which stood at around 10-15 days across markets, and (3) stable raw material and semi-finished tags.
Consequently, IF rebar prices rose w-o-w, with Mumbai witnessing a hike of INR 700/tonne (t) ($8/t) w-o-w to INR 47,800/t ($552/t) exw. However, some suppliers offered trade discounts when buyers showed resistance to higher values.
BF rebar prices show mixed movements: In the trade-level blast furnace (BF) rebar segment, price movements varied across regions. Although subdued demand exerted downward pressure, leading to a price drop in some regions, a supply squeeze emerged in other markets, driving up tags. In these regions, some major private sector mills raised their list prices to around INR 52,500-53,500/t ($606-617/t) on landed basis.
Notably, in Mumbai, benchmark BF rebar prices were firm w-o-w at INR 52,700/t ($608/t) exy, exclusive of 18% GST.
Project segment prices hovered at INR 50,000-51,000/t ($577-588/t) FOR Mumbai. Limited procurement was seen, with buyers adopting a cautious approach.
HRC tags hold firm amid limited market movements: The HRC trade segment witnessed limited price movements, as (1) weak demand hindered transactions and (2) the market showed resistance to higher values, and (3) there is ample supply available. HRC prices remained stable w-o-w at INR 47,400-49,500/t ($547-571/t), with Mumbai’s tags at INR 48,500/t ($560/t).
Additionally, while an oral hearing has been scheduled during the month-end as part of the anti-dumping investigation into Vietnamese steel imports, the news has failed to rouse market participants.
In fact, traders are complaining that this is the slowest Q4 (of a fiscal year) that they have ever seen.
HRC imports continue but exports struggle: Imports of bulk HRCs and plates stood at 195,529 t till 10 February, as per vessel line-up data maintained with BigMint. It is expected that an additional 122,115 t will be imported by the month-end.
Meanwhile, following the Lunar New Year holidays, Indian HRC export offers to the Middle East remained range-bound w-o-w at around $525-530/t CFR UAE, though Chinese ones dropped by $5/t w-o-w to $500-505/t CFR UAE. Competitive Chinese offers led to limited trading activities for Indian mills.
Exports to Europe remained slow, hampered by the ongoing anti-dumping investigations. Offers remained stuck at $590-595/t CFR Antwerp. However, a glimmer of hope has emerged, with the outcome of the anti-dumping investigations expected to be announced in mid-March. Momentum may pick up after henceforth.
Outlook
Uncertainty prevails, and there are no signs of the ongoing downtrend easing significantly anytime soon.
Additionally, with Trump’s announcement of a 25% blanket tariff on US steel imports, there are growing fears over where the surplus material will be redirected. Most regions are tightening trade policies to lock out the flood of steel import shipments that may be dumped at their shores.
Accordingly, India’s export opportunities may further shrink, given increased competition. This is worrying since the nation turned a net importer for the first time since 2015, driven by mounting Chinese steel exports.
All in all, India’s steel market is waiting with bated breath for news related to the proposed safeguard duty and is also seeking to assess the US duty’s impact on the domestic market. Stainless steel producers are apprehensive, given that India is a major exporter to the US.
India Steel Composite Index
The India Steel Composite Index is assessed on a weekly basis, every Friday at 18:30 IST, as per the weighted average prices based on manufacturing capacity and production.
BigMint considers the Composite Index with the base year being 3 January 2020 (financial year 2019-2020) and the base value as 100. The Composite Index does not give the absolute price but a trend of the market. The Indian steel industry is broadly classified into the BF-BOF and the electric/induction furnace routes. Keeping this broad classification in view, BigMint proposes to release the Composite Index by considering both production routes by manufacturing capacity and the production weighted method to compute the index for India.
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