Speed breaker ahead: Steel products in short supply

12 Jan 2021 CW Team

Housing and construction projects outside urban markets have been witnessing a slowdown for a few months with reports from dealers and buyers of a shortage of long steel products, such as bars, rods, and wires.

Construction steel, mostly produced by small, secondary steels mills spread across the eastern and southern regions has been in low-supply as many micro, small and medium enterprises (MSMEs) grapple to counter the effects of the pandemic on capital and labour as well as exorbitant iron ore prices.

As per analysts, the shortage is being felt severely in non-urban markets, where large integrated steel mills do not have a marketing presence, and where building projects may be delayed.

The shortage is being credited to the scarcity of iron ore in the local market.

In India, construction steel producers, mostly medium-sized enterprises producing unbranded thermo-mechanical treatment (TMT) bars and rebars at plants of under 2 mt per annum capacity, are unable to keep up with the increasing input costs due to lack of pricing power to pass on the rise in prices to their customers.

Access steel price trends here.

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