Metal Prices Gain Momentum but Input Costs Weigh on Recovery

According to a recent report by Centrum, metal prices have been gaining momentum in August, but rising input costs remain a key concern for sustained recovery. Despite mixed demand conditions, the metals sector showed improvement across major segments, with prices strengthening globally.

The report noted that hot-rolled coil (HRC) prices rose around 3% month-over-month (MoM) each in the US and Europe, while China's export HRC prices remained relatively stable. In India, steel prices also recovered, particularly rebar, which surged nearly 10% MoM and ~12% year-over-year (YoY), while HRC prices increased ~2% MoM and ~19% YoY.

The sharp rise in rebar prices was supported by planned maintenance shutdowns at integrated steel plants, suspension of fresh bookings, lower inventories, tighter supply, and healthy demand. Hot-rolled coil prices also benefited from limited availability, controlled dispatches, and stronger demand from the Middle East, while domestic demand remained largely need-based.

On the input side, steelmaking raw material prices showed mixed trends in August, with iron ore prices declining ~2% MoM and ~3% YoY. However, NMDC raised lump prices by Rs 150/tonne in September while keeping fines prices unchanged.