Owing to subdued domestic demand and slow recovery of global markets from the winter slump, Indian steel market remained shrouded in uncertainty throughout February.
As per SteelMint assessment, on monthly average basis – prices of Semi finished and Finished long steel decline by INR 500-1,000/MT in Feb as compared to Jan 2018.
However, in the same time frame, Flat steel like HRC/CRC and HR Plate prices rose sharply by INR 2,000-3,000/MT (USD 30-45) due to supply constraints owing to low production by large producers and low imports.
Analysing price movement of key raw materials – Coking coal prices declines by USD 25/MT, Pellet offers also fell by INR 690/MT, meanwhile Iron ore prices were stable in the Indian domestic market compared to monthly average Jan Vs Feb 2018.
Iron Ore and Pellets: India’s largest iron ore miner, NMDC supplied 368 rakes of iron ore in Feb’18, recording a decrease of 11% as against supply in Jan’18 which stood at 413 rakes. The miner had kept prices unchanged in Feb’18 except for a small reduction of INR 30/MT in DR-CLO
— NMDC’s iron ore sales decreased by 10% M-o-M to 0.83 MnT in Feb’18 compared to 0.92 MnT in Jan’18.
— Indian Iron ore export hit 10 months high in February and witnessed significant increase of 75% M-o-M in Feb’18 to 2.06 MnT as against 1.18 MnT Jan’18.
— Indian iron ore imports in Feb’18 recorded at 1.07 MnT, down 45% as against 1.95 MnT in Jan’18, according to the customs data maintained by SteelMint.
— JSPL, India’s largest pellet exporter has concluded 50,000 MT Pellet export deal at around USD 116/MT, CFR China in the first week of Feb’18.
— Indian pellet exports have registered a fall of 9% M-o-M to 0.58 MnT in Feb’18 as against 0.64 MnT in Jan’18.
Coking Coal: On monthly average basis, coking coal prices came down in Feb’18 as export demand weakened due to Lunar Year holidays in China.
Offers for the Premium HCC have gone down by around USD 25/MT (9.55%) in Feb’18 and stood at around USD 237/MT CNF India (monthly average).
Coking Coal Imports in India sunk 18.4% M-o-M in Feb’18. The drop in imports could be attributed to buyers in India lowering their imports in the month due to high prices of coal in the Australian market. According to the import data maintained by CoalMint Research, in India, Coking Coal imports were at around 3.99 MnT in Feb’18 and in Jan’18 it was recorded at around 4.89 MnT.
Scrap: Following rise in global scrap prices, the Indian domestic scrap demand also strengthened, as a result, the prices of local HMS scrap increased by INR 600-1,200/MT (USD 9-19) M-o-M.
Imported ferrous scrap offers increased in Feb’18, on monthly average basis, offers for HMS 1and2 reported at USD 360/MT in Feb’18 against USD 340/MT in Jan’18 of Middle East origin, CFR Nhava Sheva. In line average offers for Shredded scrap from Europe also rose by USD 20-25/MT to USD 370/MT, CFR India.
Semi Finished Steel: On an average, domestic sponge prices slipped by INR 400-800/MT (USD 6-13) on subdued demand by local EA and Induction furnaces.
— Indian sponge iron (DRI) export offers started to increase in the 2nd half Feb’18 and registered hike of USD 10-15/MT. Rise in global scrap prices and surge in domestic prices led to strengthening of export offers.
— In the mid of the month, RINL concluded its 5,504 MT billet and 11,008 MT bloom export tender to Nepal at around USD 510/MT ex-mill, this tender was issued on 2nd Feb 2018.
— Indian bulk billet exports is seeing a descending fall in Feb’18 as realization was quite good on domestic trades because of the higher prices. Indian bulk exports of billets were recorded at 60,500 MT (including bloom) in Feb’18 against 72,000 MT in Jan’18, down 16% M-o-M.
— On monthly average basis Indian Pig iron offers increased by INR 600-1,200/MT (USD 9-19) due to supply crunch amid closure of few plants.
— TATA Metaliks, has increased prices twice in Feb, total of INR 800/MT (USD 13) on improved demand on limited supply by the other foundry producers.
— Vedanta Resources (Sesa Goa Limited), one of the major foundry grade pig iron producer in India, has raised its prices after the Supreme Court’s verdict on cancellation of 88 iron ore mines renewals in Goa. The company’s offer during Feb for Foundry grade (high silicon) was heard at INR 32,500/MT (USD 504) ex-plant.
Long Steel: Finish Long steel price assessment neither got broaden nor got narrow on monthly basis although the price range got slight obstacle doesn’t seem to be negative, proportionately view of central region (Raipur) rebar stood (-0.60%) in Feb’18 against Jan’18 as per below table.
In the mid month, higher price level were well absorbed by trade participants and supply movement was average amid supported demand. Further, Wire Rod manufacturers from Central region- Raipur gave hefty discount of INR 1,200-1,500/MT to maintain the supply demand movement and current discount level heard to be around INR 700-800/MT.
— During Feb’ 18, the Indian large producers have raised long steel — Rebars and Wire rod, prices by around INR 2,000-2,500/MT (USD 30-38), The price range for Rebars (10-25mm) stood at INR 43,000-44,000/MT ex-Mumbai and excluding 18% GST.
— Indian bulk rebar exports have slightly shrunk to 1.53% with 68,310 MT in Feb’18 as against 69,370 MT in Jan’18, as per the vessel line up data maintained by SteelMint Stats.
— Finished long (Bar & rods and Structures) steel production in India by both large and medium/small scale producers stood at 3.98 MnT in Jan 2018 as per JPC report. The production surged by 2.57% Y-o-Y in Jan’18 against 3.88 MnT in Jan’17. Further, on monthly basis it gained by around 7% with 3.98 MnT compared with 3.72 MnT in Dec’17.
Flat Steel: Major Indian steel manufacturers have raised domestic flat steel prices by INR 1,500/MT for Feb deliveries. Following this flat steel prices showed uptrend in traders market. Supply constraints twinned with lesser import bookings led to higher prices of flat steel in domestic market.
— On an average basis Indian HRC export offers witnessed rise by 6% M-o-M basis to USD 655/MT in Feb’17 which was USD 610-620/MT FoB India in Jan’17.
— On monthly average basis domestic flat steel prices rose by 4-7% and are assessed at INR 44,500/MT (HRC, 2.5-8 mm), INR 49,500/MT (CRC, 0.90mm) and INR 44,000/MT (HR Plate, 5-10mm). All prices are on Ex-plant, Mumbai.
— Also, in Feb – Tata Steel Kalinganagar plant is undergoing maintenance issue in their plant due to which they are unable to supply adequate material in domestic market.
Monthly Average Prices – Feb’18 Vs Jan’18
| Products | Markets | Prices in INR/MT | M-o-M (%) | |
| Feb’18 | Jan’18 | |||
| Pellet Fe 63%, 6-20 mm | Ex-Barbil | 5,810 | 6,500 | – 10.62 |
| Iron ore Fe 62%, 5-18 mm | Joda loaded to wagon | 5,800 | 5,800 | 0.00 |
| Coking Coal, Premium HCC | CNF India | 237 | 262 | – 9.55 |
| Scrap HMS (80:20) | Ex-Mumbai | 25,000 | 23,800 | + 5.04 |
| C-DRI 80 FeM | Ex-Raipur | 21,200 | 21,900 | – 3.20 |
| P-DRI 80 FeM | Ex-Raipur | 19,900 | 20,700 | – 3.86 |
| Pig iron Steel grade | Ex-Raipur | 28,800 | 28,500 | + 1.05 |
| Billet 125*125 MM | Ex-Mumbai | 34,550 | 34,700 | – 0.43 |
| Rebar (12mm) | Ex-Raipur | 36,160 | 36,400 | – 0.66 |
| Wire Rod (5.5 mm) | Ex-Raipur | 37,800 | 38,450 | – 1.69 |
| Structure ( 40 Angle) | Ex-Mumbai | 38,550 | 38,650 | – 0.26 |
| HRC (2.5-8 mm) | Ex-Mumbai | 44,500 | 42,500 | + 4.71 |
| CRC(0.90mm) | Ex-Mumbai | 49,500 | 46,500 | + 6.45 |
| HR Plate(5-10mm) | Ex-Mumbai | 44,000 | 42,000 | + 4.76 |
Prices are Ex-works, Exclusive of GST at 18%
Indian Export Reference Prices as on 9th Mar’18
| Commodity | Size and Grade | Prices | 1W | 1M |
| Pellet | Fe 64% | 106 | 107 | 105 |
| Billet | 150*150 mm | 530 | 510 | 510 |
| Pig Iron | Steel Grade | 385 | 365 | 370 |
| HRC | 2.5-8mm, IS 2062 | 650 | 635 | 620 |
Prices in USD/MT
Source: SteelMint Research
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