Indian Steel Market Weekly Snapshot

During the Week-24 (11-16 June) of 2018, Indian domestic trade activities were subdued on average supply movements amid uncertainty in the market.

In the beginning week, the prices of Semi finished & finished long steel products were in down trend. However in later days it recovered due to halt power supply by Jindal in Central region, Raigarh – which is one of the major merchant supplier of Ingot/billet to neighbouring regions.

As per SteelMint’s assessment, in these days prices of Semis products (Billet & Sponge iron) have fluctuated by INR 200-500/MT (USD 3-7). However, the Finished Long steel prices declined by INR 500-800/MT. In context to Flat steel the suppliers have maintained offers firm in line with limited trade activities.

Iron ore and Pellets: As per the sources, iron ore road freight to be an increase in Joda sector (Odisha). Road freight is expected to increase by about INR 3-3.5/MT per km w.e.f 17th June 2018.

Domestic pellet offers in India are still trading at the high rate but this week it seems to be a little slower than last week. In Durgapur, Central and Sothern India pellet price assessment have decreased by INR 100/MT W-o-W. However, Western India (Rajasthan) based pellet maker – Jindal SAW has increased pellet prices by INR 150/MT amid a hike in global iron ore price.

Indian pellet exporters were surprised by high prices in China. Current assessment at USD 110-111/MT, CFR.

Scrap: Indian scrap market remained almost flat this week, however inquiries have gained momentum. Most of the participants are expecting that scrap bookings would resume again in upcoming days as very less volumes have been booked in last two months’ time. Price assessment stood almost stable and very limited trades reported in the market. Amid a decline in domestic scrap prices, most of steelmakers preferred domestic scrap over imported.

Price assessment in containers for Shredded from UK and USA stood stable at USD 380-385/MT while South Africa and Dubai origin HMS 1 scrap assessed in the range of USD 370-375/MT on the CFR Nhava Sheva basis. West African and European HMS assessment stood in the range of USD 345-355/MT, CFR depending on the quality of scrap in containers.

Coking Coal: Seaborne coking coal prices continue to remain elevated on the back of buoyant sentiments prevailing among Chinese end-users coupled with acute supply tightness because of the ongoing service disruptions on the Goonyella rail system in the Australian state of Queensland.

Reportedly, coal exports from Australia’s metallurgical coal dominant region of North Queensland has made a strong comeback in the last month and is inevitably poised for further strength. However, few Chinese buyers were heard to have momentarily halted their coking coal purchases and are likely to resume procuring seaborne cargoes only when prices retreat for the premium grade. Import offers for the premium HCC are assessed at around USD 201/MT FOB Australia, which amounts to around USD 216 CNF India.

Semi Finished: Indian Sponge & Billet market observed volatility in prices due to fluctuating demand. As per producers in East region demand was on average mode from domestic market, however export inquiries were limited for both Sponge iron & Billet. Similarly subdued demand being observed in rest of major markets of India.

However due to improved supply Steel grade Pig iron prices remain on down trend and registered fall of INR 300-700/MT on weekly basis, as per assessment.

— Nepal mills have limited fresh bookings due to volatility in Indian steel prices and closing of Nepalese financial year. SteelMint’s price assessment for Induction grade billet exports to Nepal (100*100 mm) stood at around USD 530-540/MT ex-mill, Eastern India.

— On 13th June, SAIL’s auction held to sale about 3,400 MT rejected Billet/bloom slabs heard to have received bids at INR 35,100-35,400/MT ex-works, Bhilai Steel Plant (BSP). As per sources, total allotted quantity have been booked by participants.

— Indian sponge iron export offers increased by USD 2-3/MT W-o-W and the price assessment for 80 FeM sponge lumps are at USD 360/MT CPT Benapole (dry land port of Bangladesh & India) and USD 380/MT CFR Chittagong, Bangladesh. As per participants no fresh deals due to festive weak activities in Bangladesh.

— RINL had floated export tender of 15,000 MT (+/-10%) basic grade steel making Pig Iron for delivery by 10 Jul’17. The due date for submission of bids was 11:00 AM on 14 Jun’18. However due to less participation the company has extended bid due date till 20 Jun’18.

— Jindal Steel offers assessed – Pooled iron at INR 27,500/MT, Granulated Pig iron (Panther shots) at INR 28,500/MT ex-plant, Odisha & Steel grade Pig iron at INR 29,500/MT ex-plant, Raigarh.

— Recently, MMTC cancels Pig iron export tender of 40,000 MT (C: 3.6-4.3%; Si: up to 1.24%; Mn < 1%, S: 0.05% max; P: 0.2% Max) owing to high bid expectations, whose due date for submission of bids was on 06 Jun’18. As per sources the bids fetched were in the range of USD 386-391/MT, FoB India.

— SteelMint’s Pig iron export price assessment stood at USD 385-395/MT FoB India, USD 395-405/MT FoB Brazil and USD 385-390/MT FoB Black sea.

Finish Long Steel: Finish Long observed slothful price range by around INR 200-1,000/MT amid slow buying inquiries and limited trade volumes in overall region but it has pushed a head from last couple of days & rebound around INR 500-800/MT.

After heading with optimistic sentiments demand has been slightly improved but traders are still buying with cautious hand & convey the same with getting the confirmed orders from retailers.

Further as per market sources, one of the major Rebar production market Jalna (Maharashtra) seems doesn’t have selling pressure amid suffice dispatches in hand & average inventory levels.

Rathi Steels based North region – Delhi has decreased the price range by around INR 1,000/MT on week basis and currently offering 12mm Rebars at INR 45,100/MT ex-work, & excluding GST.

Flat Steel Market: This week domestic HRC prices remained stable amid dull buying and softening of demand in domestic market. Market participants shared, arrival of monsoon season along with festive month of Ramadan has lead to weak purchases in traders market.

Currently trade reference prices (basic) for HRC (IS2062) 2.5 mm-8 mm are assessed at INR 46,000/MT (ex-Mumbai),INR 46,000-46,100/MT(ex-Delhi), INR 47,000-47,500/MT (ex-Chennai).The prices mentioned above are basic prices excluding GST at 18%.

However sentiments in CRC market were reported to be better owing to good demand from automobile sector. Trade reference prices (basic) for CRC (IS513) 0.9mm is hovering in the range of INR 51,500-52,000/MT (ex-Mumbai),INR 53,200-53,300/MT (ex-Delhi) and INR 52,000- 52,500/MT (ex-Chennai).The prices mentioned above are basic prices excluding GST@18%.

As per market sources hike in flat steel prices in the month of June seems difficult to absorb amid slow movement of material in domestic market.

In the beginning of the month major Indian mills have announced price hike of up-to INR 500/MT (USD 7) for June deliveries amid higher production costs.

Indian Raw material and Finished Steel reference Prices as on 16 June 2018 (Week 24)

Prices are Ex-works, Exclusive of GST at 18%

Indian Export Reference Prices as on 16th Jun’18

Prices in USD/MT
Source: SteelMint Research