Semi finish prices in North India hit rock bottom and corrected by INR 1,500-2,000/MT in last 1-month. However, other market has witnessed correction by upto INR 1,000/MT.
Semi finish prices in Mandi Gobindgarh & Ludhiana have declined by INR 1,500-2,000/MT in last 1-month. However in other market, it has declined by upto INR 500-1,000/MT.
Steel manufacturers in Punjab have requested the state government to reduce VAT on steel and lower the electricity charges to support loss making steel units. They have also gone for strike from past couple of days. Government presently hike the electricity tariff by 2-3% and also stringent the entry tax law. SteelMint while speaking to market participants assessed:
- High Price and Shortage of Sponge Iron supports Sponge based Market: Durgapur Ingot prices have corrected by INR 450/MT and Raipur by INR 550/MT.
- Domestic Scrap Prices cheaper in North & West India: Domestic Scrap prices in North India are cheaper as many furnaces opt to reduce the production owing to low conversion. Scrap prices in Mandi have fallen by INR 1,400/MT and in Alang (Ship breaking), melting Scrap prices have declined by INR 900/MT against last month.
- Ingot/Billet Production Cut: Furnace manufacturers in Mumbai, Jalna, Raipur & Durgapur have reduced the production of MS Ingot/Billet to maintain the demand supply. Sources confirmed that major furnace operators are running plant at 50-60% capacity and in night shift.
- Shift in Sponge Pellet: Induction furnace intake of Sponge pellet in comparison to Sponge iron has risen owing to increasing gap. Sponge pellet is cheaper than Sponge iron by INR 2,000-2,200/MT.
Outlook: Prices to remain range-bound in Short Period – Manufacturers
Market sources mentioned, “There is limited chance for price rise in the market as coming festival (Navratri) will create labours problem, which will also affect the dispatches (sales). It is also expected that offers will fluctuate by INR 500/MT from current levels of INR 28,700-33,000/MT.”
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