Weekly round-up: Semis, longs see uptrend, flat steel under pressure

Domestic steel prices rose during week 27 (27 June- 2 July 2022). Semi-finished prices rose in the range of INR 750-3,500/tonne (t).

Domestic induction furnace finished long steel offers witnessed an upward trend with offers spurting by up to INR 1,700/t w-o-w. The trade reference prices for finished flats (HRCS and CRCs) fell by INR 100-1,500/t.

Iron ore and pellets

• SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 8,000/tonne (t) DAP Raipur on 1 July, 2022. Around 29,000 t of pellet (Fe 62/Fe 63%) deals were reported at around INR 7,950-8,350/t DAP Raipur and all were taken into consideration in this publishing window.
• India’s top iron ore miner, NMDC, produced 2.57 mnt of the raw material in June, down 20% m-o-m from 3.2 mnt in May. Iron ore sales, too, fell by 28% m-o-m to 1.9 mnt in June.
• Vedanta scheduled an auction on 30 June for sale of iron ore fines from its A. Narrain mines in Karnataka’s Chitradurga district. According to market sources, the entire quantity of 100,000 t of fines (-10mm, Fe 55-58%) was booked at a base price of INR 1,438/t (excluding royalty, DMF and NMET).
• India’s iron ore export market continues to remain quiet this week in the absence of trade amidst price unviability and weak demand from China. Market indications for Indian-origin low-grade fines (Fe 57%) were at $60-65/t CFR China. On the other hand, domestic low-grade fines (Fe 57%) prices were heard at around INR 1,000-1,200/t ex-mines, Odisha.

Coal

• Prices in the Australian coking coal market continued to fall this week, owing to a weak steel market and a supply-demand gap. Premium HCC prices have fallen by $48/t w-o-w. The price on 2 June was $302/t FOB Australia and $328/t CNF India.
• Portside RB3 (4800 NAR) prices rose further by INR 1,000/t this week to INR 16,000/t at Vizag Port amid strong procurement demand from the sponge iron sector. RB2 offers, however, remained stable at INR 18,000/t.
• South African RB1 prices fell by $12/t w-o-w at $343/t FOB as coal transport picked up pace at RBCT Port. A sharp fall was limited amid rising procurement demand from Europe as its Russian sanctions deadline neared in August.

Ferrous scrap

• With a recent deal concluded in Turkiye at high prices, the global scrap market gained momentum in India. Imported prices rose due to the limited availability of scrap domestically which resulted in active booking in containerized and bulk ferrous scrap. Improved semi finished and long steel prices kept imported scrap prices higher.
• SteelMint’s assessment of Europe-origin shredded scrap prices stood at $455/t CFR Nhava Sheva, down by $20-25/t w-o-w.
• Dubai origin HMS 1 is now being offered at $470-475/t CFR NHSV basis.

Ferro alloys

• Indian silico manganese weekly average prices were range-bound with marginal drop amid moderate demand. According to SteelMint’s assessment on 1 July, prices for 60-14 grade were at around INR 83,800 /t ex-Durgapur, INR 83,500/t ex-Vizag and INR 84,250/t ex-Raipur.
• Indian ferro manganese (HC70%) prices were range-bound. The prices for HC 70% were at INR 86,800/t ex-Durgapur and at INR 87,000/t ex-Raipur, assessed on 1 July. Ferro manganese export prices were stable amid limited demand in both domestic and export markets. Weekly average prices for HC 70% were at $1,110/t FOB India, and for HC 75% grade, at $1,210/t FOB India.
• According to SteelMint’s assessment on 30 June, ferro chrome (HC60%) prices were at around INR 106,700/t exw-Jajpur. The prices dropped after the Chinese stainless-steel mills’ tenders declared lower purchase prices for July 2022.
• Indian ferro silicon (HC70%) prices dropped by around INR 3,750 /t w-o-w with buyers reluctant to book material at higher prices. According to SteelMint’s assessment on 30 June 2022, most of the ferro silicon producers offered at around INR 146,500/t exw- from Guwahati and Bhutan.

Semi-finished

Indian semi finished steel prices increased sharply as per SteelMint’s assessment. Billet offers rose in the range of INR 1,200-3,500/tonne across regions with a major rise of INR 3,500/t reported in Chennai in southern India. Similarly, sponge iron prices also upped by INR 750-1,650/t w-o-w.

• SAIL conducted an auction for 3,000 t of basic pig iron on 30 June from its IISCO Steel Plant. Buyers booked only 1,000 t at a weighted average price of INR 44,550/t exw.
• One of India’s largest steel producers concluded a deal for 2,500 t of steel grade pig iron at around $565/t loaded to rake, Central India which is equivalent to $665/t CPT Nepal (including export duty of 15%).
• Vedanta floated a 40,000-t pig iron export tender for August shipment. The material offered has specifications of 3.5-4.6% carbon, 0.08% sulphur, and 1.5% max silicon.
• SAIL held an auction for 1,600 t of basic grade pig iron (in 20 units) on 27 June from the Rourkela Steel Plant (RSP). Due to higher offers, buyers booked only 50 t (one unit) out of the total material at the base price of INR 45,800/t exw.
• About 7,500 t of sponge iron export deals were reported this week, while current offers hovered at $445-450/t CPT Nepal for FeM 79-80% material (70% lump and 30% fines).
• Sponge iron export offers to Bangladesh increased by $20-25/t to $415-520/t CPT Benapole. Demand remains weak due to falling steel prices in Bangladesh.
• IF-route billet export offers rose by $15/t w-o-w, to around $620/t exw-Durgapur, equivalent to $645/t CPT Nepal. Demand remains limited due to competitive offers for BF-route billets.
• Three to four rakes (8,000-10,000 t) of BF-route billet export deals from eastern India-based mills were concluded this week to Nepal at an average price of $640/t CPT Nepal.
• Spot steel grade pig iron prices rose by INR 600-1,200/t with a major hike of INR 1,000-1,200/t noticed in Ludhiana and Durgapur, due to the rally in billet prices.

Finished longs

The induction furnace-route finished long steel market saw limited demand and slowdown in bulk trade in the spot market mainly from Tuesday onwards in major supplying centres.

However, manufacturers of TMT rebar did not have much sales pressure owing to adequate future booking orders. Thus, they kept prices on the higher side throughout the week, despite traders booking limited quantities at these prices from middle of the week. Volatility in semi-finished steel prices in key markets led to lack of confidence among traders, SteelMint learned.

• On a weekly basis, prices of rebar saw an uptick by INR 200-1,700/t w-o-w in most major markets while a sharp hike of INR 2,500/t was noticed in Chennai.
• The trade reference prices of Fe 500 grade rebar manufactured via the IF route for 10-25 mm size were assessed at INR 52,400-52,800/t exw-Raipur, and at INR 54,900-55,300/t exw-Jalna.
• Trade discounts given by Raipur-based heavy structural steel manufacturers were at around INR 1,500/t and trade reference prices of 200 mm angles stood at INR 57,300-57,700/t exw Raipur.
• Trade discounts given by Raipur-based wire rod suppliers were up to INR 1,000/t and trade reference prices stood at INR 53,500-54,000/t exw-Raipur, INR 53,800-54,000/t exw Durgapur, for 5.5 mm.

Finished flats

• Trade market prices of finished flat steel continued to remain under pressure this week amidst limited trade. Market participants, both sellers and buyers, awaited the July sales prices.
• Hot-rolled (HR) coils and plates and cold-rolled coil (CRC) prices declined against the previous week levels. However, value-added coated flat steel products remained range-bound. End-users bought in small volumes to fulfil their urgent needs which weighed on restocking interest of the distributors as well.
• The sustained reduction since the beginning of April has brought the prices of HRCs and plates close to the levels last seen in April 2021, as per data maintained with SteelMint.
• On the exports front, limited trade activities post-announcement of the export duty led to slower movement of inventories from mills. Thus, mills have been scouting the overseas markets of Vietnam, the Middle East, and European Union with reduced price indications. A key point to note is that the mills are now offering boron-added HRCs for exports to the mentioned countries. SteelMint’s weekly HRC export index dropped by $40/t this week to $660/t FOB east coast. The current week’s prices levels are close to $635/t FOB assessed on 8 December 2020.