OfBusiness Secondary TMT Dailies

9th June’23

Price

• Secondary TMT prices are uniform across regions, but the increasing trend is unsustainable due to lowered rates by primary TMT and a minimal price gap. Working rates for secondary TMT now depend on individual orders, with plants operating at lower conversion rates while opening rates remain fixed. The last operated prices of secondary TMT:
  • Raipur: Rs. 48,200/ton
  • Delhi: Rs. 52,200/ton
  • Ahmedabad: Rs. 51,700/ton
  • Hyderabad: 50,700/ton (up by Rs. 200/ton)

Demand and Supply

• Despite the growing rates of secondary TMT, manufacturers, and traders have not observed an actual increase in demand. They suspect the price hike is due to raw material scarcity or other factors. Demand for secondary TMT was already low due to monsoon arrival, and now consumers are shifting towards primary due to the minimal price difference. Previously, there were no supply issues, but the lack of project orders has resulted in overbooked plants handling dealer-grade orders. Recent project orders have further complicated manufacturing.

News

• Vedanta plans to auction 20,000 tons of Iron Ore lumps from Nadidihi mines in Odisha, with the floor price pending announcement. The price of Sponge Iron CDRI in Bellary market rose to Rs. 28,800/ton, reflecting increasing demand. Billet price in Rourkela increased to Rs. 43,000/ton, indicating positive demand and favorable market conditions.

OFB’s Opinion

• Secondary TMT rates will decline due to the monsoon and the price difference with primary TMT. Primary TMT has lowered rates by Rs. 1,500-2,000/ton, forcing secondary to follow suit. However, the expected rate reduction hasn’t been observed in the market for the past three days. Unsustainable uptrend rates will create supply issues for primary as consumers prefer primary due to the price difference.