India's Primary TMT Market: Current Prices And Expected Revision By Manufacturers

The primary TMT market in India remained volatile during March 2023 due to low demand and consistent supply. Although offers from primary mills were maintained, distributors were selling their materials at lower prices by adjusting trade discounts to clear their TMT stock. This put pressure on primary TMT mills to reduce their prices and inventory levels, also they were actively negotiating on any inquiries to settle deals.

Price Revisions

At the beginning of the new fiscal year, some primary mills have been planning for a price revision in April. The prices are likely to decrease by Rs 500-1,000/ton for the first half of April dispatches. As a result, distributors and traders have lowered their TMT offers.

• Current TMT Offers- The current offers for primary mills’ TMT are around Rs 59,500-60,000/ton for Delhi and Mumbai, and Rs 60,000-60,500/ton for Chennai (plus GST) on an ex-works basis.

Production Cuts And Raw Material Shortages

In response to the current state of the primary TMT market, several plants have reduced their production levels by 10-20% to balance supply and demand in the spot market. RINL has encountered challenges with raw material shortages at its plant and is actively seeking funding to support its working capital needs and address these supply constraints. Additionally, the company has submitted an inquiry for a one-time purchase of 100,000 tons of billet to support the rolling operations at its Vizag plant, sources reported to Ofbusiness.

Future Outlook

Primary mills’ TMT prices are expected to notice a price correction for the first half of April. However, Steel prices have already reached the bottom level, making it less likely for mills to reduce TMT offers for the latter half of the month. The TMT market’s future outlook remains uncertain and dependent on the demand and supply dynamics in the coming months.

Insight

The primary TMT market in India is currently facing a challenging situation due to low demand, raw material shortages, and production cuts. While primary mills are expected to reduce TMT prices for the first half of April, the future outlook remains uncertain and dependent on the overall demand in the construction industry. It is important for stakeholders to closely monitor the market dynamics and adjust their strategies accordingly to stay competitive in the industry.

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