SteelMint’s domestic steel scrap (end-cutting) index climbed INR 800/t to INR 46,500/tonne (t) DAP Mandi Gobindgarh on 7 July 2022.
The indicative prices for LMS (light melting scrap) prices were at INR 41,300/t, HMS 80:20 at INR 43,800/t and CR busheling at INR 48,000/t.
As the sudden hike in semi-finished prices has perplexed the market, most participants held scrap offers and opted for a wait-and-watch mode. Meanwhile, some semi-finished steel deals for the same-day delivery (Hazir material) are heard to have been concluded at higher levels.
Indian steel producers, mainly in the northern region, are still facing challenges in sourcing scrap. Buyers raised their bids to secure adequate volumes following a marginal rise in semi-finished steel prices.
In a latest development, Maharashtra State Electricity Distribution Company Limited (MSEDCL) has increased fuel adjustment charges (FAC) by INR 1.20/unit to around INR 1.35/unit for the billing month Jun-Oct’22. This will increase production costs of hot charging mills by INR 1,000-1,200/t, varying as per load factor.
Market highlights-
End-cutting and ingot spread: The spread between end-cutting scrap and ingots remained unchanged w-o-w at INR 5,500-5,700/t.
Domestic and imported scrap price gap: In Mumbai, imported melting scrap (HMS 80:20) in containers of Europe-origin was traded at $430-435/t (INR 34,000-34,500/t) CNF Nhava Sheva. Mills in Mumbai and those in the nearby regions are preferring to import scrap because domestic material is costlier by around INR 3,000-4,000/t.
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur decreased by INR 100-200/t d-o-d to INR 15,700/t.
To see SteelMint’s Melting Scrap Assessment, pricing methodology and specification documents, Click here
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