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India: Major ERW pipes producer eyes further INR 1,000-1,500/t ($13-20/t) price hike in Nov

India: Major ERW pipes?producer eyes?further INR 1,000-1,500/t?($13-20/t) price hike?in Nov...

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22 Oct 2021, 20:21 IST
India: Major ERW pipes producer eyes further INR 1,000-1,500/t ($13-20/t) price hike in Nov

Traders are quite confident that the electric resistance welded (ERW) pipes segment could see a price hike of around INR 1,000-1,500/tonne (t) ($13-20/t))in the first week of Nov'21 on account of an increase in the prices of hot-rolled coils (HRCs) and rising demand in the real estate sector in the upcoming festive season.

A leading structural steel tubes?manufacturer had raised pipe prices by 1,000/t each on 11 Oct'21 and 18 Oct'21 owing to a hike in HRC prices. "Pipes prices are expected to increase by INR 1,000/t on 1 Nov'21 and there might be another hike of INR 2,000/t in the next month,"said a Mumbai-based distributor.

Current trade offers for base grade ERW pipes (25-125 NB, 2.2-6 mm thickness) are assessed at INR 73,000/t exy-Delhi, at INR 73,250/t exy-Pune and at INR 71,000/t exy-Raipur. Prices do not include GST @ 18%.

At present, Tata Tubes is reported to be booking coil-based pipes at INR 73,000/t ($976/t), ex-Jharkhand, for October deliveries, compared to the last revised price in September which stood at INR 72,000/t ($961/t), ex-Jharkhand. Prices do not include GST at 18%.

HRC prices hit all-time highs

Major Indian steel producers, SAIL, JSW Steel, and Tata Steel have taken two rounds of price hikes for hot-rolled coils (HRCs) in Oct'21 backed by the spurt in restocking activities, and an increase in coal prices, thereby, pushing up HRC prices to all-time highs.

As a result, domestic HRC trade reference prices have been scaling new highs since Oct'21.

SteelMint's benchmark price assessment for 2.5-8 mm IS 2062 HRC stands at an all-time high of around INR 72,000-73,000/t (exy-Mumbai), significantly up by INR 1,600/t as against INR 70,500-71,000/t a week back.

However, CRC (IS 513 Gr O, 0.9mm) prices remain range-bound at INR 75,500-76,000/t (exy-Mumbai), unchanged w-o-w. Prices mentioned are exclusive of GST @18%.

India: Mills announce further price hikes, HRC rates hit all-time highs

Housing demand gets a festive boost

The decline in the second wave and economic resurgence have provided a fillip to the demand in the residential real estate sector. It is anticipated that the festive season would increase demand and growth in the housing sector. Historic low interest rates on home loans, lucrative festive offers from developers will most likely be the major drivers of this strong revival.

India: Major ERW pipes?producer eyes?further INR 1,000-1,500/t?($13-20/t) price hike?in Nov

Way?ahead?

Given the current market scenario, domestic HRC trade prices are likely to increase, supported by rising demand, SteelMint learned from market participants. Thus, ERW pipes prices are likely to edge up in the near term on account of surging market prices and demand in the domestic market.

 

22 Oct 2021, 20:21 IST

 

 

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