Indian secondary steelmakers, who share about 45% of the country’s total crude steel production, are struggling to sell their products at profitable prices. In order to sustain in domestic market, they have been persistently reducing their prices, incurring low profit margins.
In this month, lowest conversion spread has been recorded in Raipur (Chhattigarh), which is India’s one of the major producers and suppliers of semi finish and finish long steel products. As per semis manufacturers, conversion spread from P-DRI to billet has currently reached a low level of INR 8,600-8,800/MT, which should be around INR 10,000/MT.
Similarly in scrap based markets like Mumbai and Chennai, current conversion spread has touched INR 7,000/MT and INR 8,000/MT respectively.
However, Durgapur based manufacturers are getting a sustainable conversion spread of INR 9,700-10,000/MT, which is sufficient for producing billet.
In future prospects, prices are likely to decline, following further corrections in raw material prices.
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