Domestic mill-scale prices in India have continued to decline on falling iron ore and pellet prices amidst limited buying. SteelMint’s current assessment for mill scale (Fe 70/68%) stands at INR 6,800/t DAP Kandla, lower by INR 200/t, w-o-w.
The supply tightness signals have been especially visible in the Gujarat-based markets, causing most of the players to take the material from Punjab, due to which prices were assessed higher at around INR 7,000/t DAP Kandla.
However, some local makers from Kandla are offering mill-scale at around INR 6,500-6,600/t, SteelMint learned.
By the end of last week, a western India-based steel player bought 20,000 t of mill scale material at INR 8,200-8,300/t FOB Kandla for coastal movement to a plant located in Paradip and another 20,000 t were under negotiation.
Raipur mill-scale prices drop 16% m-o-m in Sept’21
Average Raipur mill-scale prices decreased by 16% m-o-m to INR 6,330/t exw in Sept’21 compared to INR 7,500/t in Aug’21, according to data maintained with SteelMint. The prices have decreased on the back of declining iron ore and pellet prices. Market participants expect prices to fall further in the near term.
However, average prices, DAP Kandla, in Sept’21 were down by around 13% to INR 7,100/t against INR 8,200/t in Aug’21.
SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, fell by 18% m-o-m to INR 11,050/t DAP Raipur on 24 Sept’21. Competitive offers from other states may keep pellet prices in Raipur under pressure. On the other hand, a major pellets producer in Raipur continued to be under maintenance shutdown.
Outlook
With decline in pellet and iron ore prices, mill scale offers may come down further.
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