Indian Steel Market Weekly Snapshot

Indian Iron & Steel prices have sharply fall during the Week-29 (16-21 Jul). The manufacturers in major markets stated rise in inventories owing to limited domestic & export inquiries amid healthy supply of Semis & Finished Steel products.

Industry experts also believed, the price corrections are majorly due to mismatch supply-demand as supply continue to remain constant, while demand dropped seasonally.

As per SteelMint assessment, during the week prices of Semis – Billet & Long Steel – Rebars by medium/small mills have declined near about INR 500-1,000/MT (USD 7-15). In line with Flat steel, the prices plunge down by INR 500/MT (USD 7) W-o-W.

Iron Ore: As per sources, a Western India – Gujarat based steelmaker has booked about 150,000 MT of South African lump for August shipment and is expected to arrive in the Aug’18 end or early September at Kandla port (Gujarat). SteelMint has also learned from the sources that, offers for South African lump for Sep’18 shipments are at around USD 90/MT, CFR.

— Jindal SAW, Rajasthan based pellet maker is to export 55,000 MT of pellets (Fe 65%) to South Korean steel mill – POSCO, as reported to SteelMint by market participants.The domestic pellets offers for Fe 63% grade by Jindal SAW have remained stable at INR 7,350/MT (delivered Kandla).

— The reference pellet price assessment stands at INR 6,600-6,700/MT in Durgapur (delivered) & INR 6,400-6,500/MT ex-Raipur. Southern India (Bellary) based pellet makers have decreased prices to INR 6,400/MT this week.

— Indian pellet export prices of regular grade Fe 64% Pellet has increased further by USD 2-3/MT W-o-W to USD 120-121/MT, CFR China.

Scrap: Sharp currency devaluation, successively falling domestic semi-finish steel prices, ongoing monsoon and cheaper availability of domestic scrap kept Indian imported scrap booking activities very limited again this week. Market remains stagnant seeking for more clarity on global prices.

Price assessment of Shredded from UK and USA stands at around USD 365-370/MT, CFR Nhava Sheva. While offers for HMS 1&2 (80:20) have come down by USD 5-8/MT on W-o-W basis. UAE origin HMS 1&2 (80:20) offers assessed at USD 335-340/MT while HMS 1 assessed at around USD 340-345/MT, CFR. West African HMS is being offered at USD 310-320/MT, CFR Nhava Sheva depending on quality. Couple of limited quantity trade deals have heard however no buyer was much interested at current offer levels.

Coal: The seaborne coking coal market remained mostly quiet this week on scant buying as Chinese steelmakers were heard to be harbouring expectations for prices to bottom out in a falling met coke market coupled with a depreciating Yuan. Moreover, the lingering uncertainty around production cuts of steel and coke on environmental grounds as well as stringent port restrictions delaying discharge of cargoes are adding to the bearish tone in the Chinese market. Furthermore, Indian trading activity has slowed down due to the onset of monsoon. Import offers for the premium HCC grade have plummeted to as low as USD 180/MT FOB Australia.

Semi Finished: In a week duration, domestic Sponge offers fluctuated in the range of INR 100-400/MT (USD 1-6) in major markets. While in billet market, prices declined by INR 500-1,100/MT(USD 7-16) over weak buying interest due to ongoing monsoon amid dispatch issue owing to transporters strike.

— Indian induction grade billet export offers to Nepal hovering at USD 450-455/MT ex-mill, Durgapur & around USD 445/MT ex-mill Odisha, Eastern India.

— Indian Sponge iron export offers remains firm, price assessment for 78-80 FeM sponge lumps (export grade) stood at USD 330/MT CPT Benapole (dry land port of Bangladesh & India) and USD 350/MT CFR Chittagong, Bangladesh. As per a exporter in Kolkata, small parcels have been sold in current week.

— Chennai based renowned sponge manufacturer exported 1,000 MT C-DRI Lumps to Bangladesh during last week at the price of USD 355/MT CFR Chittagong- Sources

— Rashtriya Ispat Nigam Limited has invited a export tender of 10,000 MT Billets and 12,500 MT Wire Rod. The due date for submission of bids is 26 Jul’18 at 11:00 hrs.

— MMTC on behalf of NINL has floated a export tender of 30,000 MT Pig Iron which due date for bid submission is 10th Aug’18. The company in recent has concluded a export tender of 30,000 MT pig iron at near about USD 382-383/MT FoB.

— As per sources, about 40,000 MT pig iron have been sold by NINL in the last domestic offers of INR 27,500-27,900/MT (USD 398-405), ex-plant Odisha.

— Jindal Steel (JSPL) has reduced offers for Panther shots (Granulated pig iron) and current trades at INR 27,500-28,000/MT ex-plant, Angul, Odisha. Pig iron offers rolled over by the company at INR 29,000-29,200/MT ex-plant, Raigarh.

— SteelMint’s pig iron export price assessment is at around USD 380-385/MT FoB India, USD 380-385/MT FoB Brazil & USD 380-390/MT FoB Black Sea.

Finish Long Steel As per week assessment, Indian Finish Long steel prices have dipped about INR 1,200/MT (USD 17 ) commodity wise in the course of awaken inventories in the plants and strengthening selling pressure.

As per market sources, plants have reduced the production level by 30-40% particularly in central region to match demand & supply and also assuming considerable dispatch movement accordingly. Further, traders are not willing to procure bulk material at the moment and convey minor volume to retailers after confirming the quantity.

Central region based Wire Rod re-sellers have maintained the trade discount of around INR 1,200-1,500/MT but few trades have been concluded at the discount of INR 1,700-1,800/MT in last couple of days due to filtered buying inquiries. As per assessment, current Wire Rod (5.5 mm) price hovering at INR 37,000/MT ex-Raipur and excluding GST.

As per market participants view the existing price range might get sustain for near term as price range amended more than assumption or minor correction might get noticed if demand & supply doesn’t get match.

— In the mid week, BHEL (Bharat Heavy Electricals Limited) invites tender for purchase of 8,060 MT Reinforcement Steel in Bangladesh (Grade – B500B as per latest BS 4449) which due date was 20 July’18.

— In the last one week few of the Indian large mills reduced rebar prices by INR 500-750/MT, currently the prices are at INR 42,000 – 42,500/MT, size 10-16mm, ex-Vizag & excluding 18% GST.

Finish Flat Steel market continued to remain bearish with marginal correction of INR 500/MT in fewer markets. Arrival of monsoons amid dull trades have kept domestic flat steel prices under pressure in traders market. in the last week domestic flat steel prices slumped by INR 500-800/MT in traders market over passive buying.

As per SteelMint price assessment, currently trade reference prices for HRC (IS2062) 2.5mm-8mm is around INR 45,000/MT (ex-Mumbai), INR 45,000/MT(ex-Delhi) and INR 45,500/MT (ex-Chennai). Prices for CRC (IS513) 0.9mm hovering in the range of INR 50,000/MT (ex-Mumbai), INR 49,500-51,500/MT (ex-Delhi) and INR 51,000/MT (ex-Chennai). The prices mentioned above are basic on cash payment excluding GST@18%.

Domestic HRC prices have declined by INR 500/MT in Ahmedabad and Faridabad regions. However domestic CRC prices declined by INR 500-1,000/MT in Faridabad, Delhi and Ludhiana markets.

Market participants in conversation with SteelMint shared that, trade sentiments remained very dull. Thus considering the situation seasonal freight concessions from railways and further correction in prices from major Indian mills is expected in near term.

Indian Raw material and Finished Steel reference Prices as on 21 July 2018 (Week 29)

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

Indian Export Reference Prices as on 21st July’18

Prices in USD/MT
Source: SteelMint Research