Weekly: Indian steel market snapshot

Indian spot steel trades remained limited during the week-24. Participants mentioned that buying inquiries were less than the average and with rise in stock, prices fell sharply in major locations.

As per SteelMint’s assessment, this week prices of semi finished steel products have declined by INR 100-1,000/MT (upto USD 13). In context to finished steel, the secondary long steel market registered a rigorous price fall of INR 200-2,200/MT. However, trades improved in the flat steel segment.

IRON ORE and PELLETS

Odisha merchant miners iron ore prices remain unchanged this week. Sail concluded 20,000t iron ore fines at INR 1,420/t (loaded to rake; Royalty, DMF, NMET & other taxes extra) in an e-auction conducted on 9 June from Barsua mines.

PELLEX increased marginally by INR 50 to INR 6,050/wmt (DAP Raipur) this week. As per the market participants, Raipur based pellet makers have sold around 40,000t pellets at INR 6,000-6,100/t (DAP Raipur) during this week in the local market. Pellet makers in Durgapur and Jamshedpur raised offers by INR 200-300/t.

— SteelMint assessment for Fe 64% grade pellets with 3% Al increased by around $3/t to $116-118/t, CFR China against last week’s assessment at $113-115/t, CFR China. Few deals from central & eastern India are under negotiation and are likely to get concluded soon.

COAL

Australian premium low-volatile (PLV) hard coking coal (HCC) prices have held steady over the week, with Asian spot buyers largely staying on the sidelines, although some buying interest was observed in China.

Chinese market sources expect PLV coking coal prices to fall till end-June due to stringent import restrictions in place, while end-users are possibly monitoring the developments on imported coal policies to gauge market direction.

Indian spot demand for seaborne coking coal continues to remain subdued despite gradual resumption of crude steel production in line with the graded opening up of lockdown restrictions. With most steelmakers still consuming their existing long-term contract cargoes, inquiries for seaborne coking coal from India are unlikely to revive before September this year.

— Latest offers for the Premium HCC grade are assessed at around $109/t FOB Australia, $120/t CNF China and $119.40/t CNF India.

FERROUS SCRAP

Imported scrap offers to India witnessed slight uptick on strong global market. However, most buyers in western and north western regions were bidding at considerably lower levels, hence less deals getting concluded.
SteelMint’s assessment for Shredded scrap to India from Europe/North American origins stands at $290/t CFR Nhava Sheva, slightly up against last week, with most offers for Shredded now at this level, with few suppliers offering $286-287/t CFR levels to Mundra region. Buyers bids were reported below $275/t CFR

— HMS 1&2 (80:20) is still being offered at around $263-265/t CFR from the UK and $265-267/t CFR from Brazil. Last month, Brazil origin HMS, witnessed good trades to the South Indian region at around $250/t levels, when Tamil Nadu mills booked actively on less local scrap availability, but now sharp increase in offers has pulled down interest.

— HMS 1&2 (80:20) from West African origin sold to Goa mills at around $245/t earlier in the week, while fresh offers now stand at $250/t CFR. Cast Iron scrap was sold at $265/t CFR Goa was also reported, with offers now touching $270/t CFR. Very few South African HMS 1 offers were reported in the market due to permit related issues.

FERRO ALLOYS

— Silico manganese prices fell marginally in both domestic and export markets on poor demand.

— Ferro manganese prices remained stable despite dull demand and reduced Manganese ore prices.

— Prices of ferro chrome remained stable amidst better export realizations; however, the domestic market remains weak.

— Indian ferro silicon prices remained unchanged with limited domestic demand and near to absent export deals.

SEMI FINISHED

Indian billet trades slow-down this week as prices slump by INR 100-1,000/t amid poor off take of finished steel goods. In this period major fall of INR 500-700/t seen in billet in central & southern India.

Similarly, sponge iron offers dropped by INR 100-600/MT W-o-W following significant fall in billet prices & strong supply.

— Indian sponge iron (80 FeM, 100% lumps) export offers slightly up by $3/t to $273-275/t CFR Chittagong, Bangladesh. About 5,000t export deals reported this week through the Kolkata based exporters.

— Primary mills concluded export deals to Nepal at around $400/t for billet & near to $450/t for wire rod, CPT Raxaul border, as per sources. While through the mid scale mills offers dropped by $8-10/t W-o-W and assessed at $395/t for billet & $457-460/t for wire rod, CPT Nepal, via road delivery.

— Steel grade pig iron prices increased by INR 500/t in north region & INR 800-1,000/t in eastern India owing to hike prices by SAIL along with active demand. However in central India prices are more or less firm this week.

— SAIL conduction 4,000 MT pig iron auction from Rourkela Steel Plant (RSP) on 13 June. As per sources, the total alloted quantity got booked at INR 23,200-400/MT EXW.

— SAIL has floated an export tender for 30,000 t Mild steel non alloys concast slab from its Bhilai steel plant, Chhattisgarh. Offers valid till 19 Jun’20.

— Vizag Steel has invited a sale notice for export of 30,000 MT bloom in the ocean market on 100% advance payment basis. Offers valid up to 18 Jun’20.

FINISHED LONG

The finished long steel market reported significant price drop particularly in rebar (12-25 mm) where price range contracted by INR 700-2,200/t in major markets whereas few specified locations got minor changes by INR 200-300/t as per weekly comparison.

— The trade reference rebar prices (12-25 mm) through mid sized mills assessed at INR 32,700-32,900/t Ex-Raipur, INR 34,100-34,400/t Ex-Jalna & INR 35,600-36,000/t Ex-Chennai.

— Raipur based heavy structure manufacturers have maintained trade discounts by INR 200-500/t and current trade reference prices for 200 Angle is at INR 35,000-35,200/t EXW.

— Trade discounts in Raipur wire rod stood at around INR 1,000/t and trade reference prices at INR 31,600-32,100/t ex-Raipur and INR 32,900-33,200/t Ex-Durgapur, size 5.5 mm.

FINISHED FLAT

This week Indian HRC trades have picked up against the last few weeks. Stockists and traders highlighted gradual recovery in demand after several weeks of limited trades. However prices in the trade segment observed marginal correction of around INR 250-300/t in the few markets and declined by INR 1000/t on a weekly basis in eastern region.

SteelMint’s current assessment for HRC (IS 2062, 2.5 – 8 mm) for trade segment stands at INR 35,500-36,500/t Ex- Mumbai, INR 36,000-37,000/t Ex-Delhi & INR 37,500- 38,000/t Ex- Chennai. The CRC (0.9 mm IS513 GR) prices are assessed at INR 41,500-42,750/t Ex- Mumbai, INR 41,500-43,000/t Ex- Chennai & INR 40,250- 41500/t Ex-Delhi. The prices mentioned above are basic and extra GST @18% is applicable.

Market participants based in Mumbai shared that “Trades have picked up by around 50% and are gradually picking up in the domestic market post announcement of unlock 1.0 by the Indian government. Also if demand continued to remain supportive prices may improve in the upcoming month”.

Reference Prices as on 13th June 2020 (Week 24).

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

Indian Export Reference Prices as on 13th Jun’20

Prices in USD/MT
Source: SteelMint Research