- Shortage of scrap continues at Mandi
- Sponge, pig iron prices hold steady d-o-d
BigMint’s domestic end-cutting scrap index tracking the Mandi Gobindgarh market marginally fell by INR 100/tonne (t) to INR 37,700/t DAP on 24 July, 2024.
Mills are procuring scrap at minimal levels because of the ongoing shortage and lacklustre steel demand. Imported buyers are waiting for better bid-offer alignments. Regional steel mills are using a charge mix of 65% scrap and 35% sponge, while some mills are operating at 60-70% capacity due to inventory issues.
A mill owner informed BigMint: “Re-rolling mills in Mandi are looking at neighbouring states for procuring semi-finished products due to better price viability. This is posing a challenge to local semi-finished steel makers. They are finding it tough to compete because of these price differences.”
Raw materials overview
Sponge iron (CDRI) prices in Mandi held steady at INR 30,000/t. Similarly, pig iron (steel grade) prices in Ludhiana remained unchanged at INR 40,200/t DAP.
Steel market
In the Mandi region, steel ingot prices remained steady at INR 42,700/t today during the price reporting and normalisation phase. Meanwhile, prices in other key markets dipped by INR 100/t to INR 600/t. In the Muzaffarnagar steel market, semi-finished prices saw a major drop of INR 600/t d-o-d.
Rebar (Fe500) prices move down by INR 200/t to INR 47,200/t today. Due to weak demand, prices have significantly decreased by INR 1,500/t w-o-w.
Overview of other markets
The Raipur steel market has seen minimal trade activity over the past few weeks, with many mills reducing production. If this trend continues, steel makers may halt production entirely due to rising electricity costs in the state, which significantly affect steel manufacturing. In the region, billet prices decreased by INR 250/t to INR 38,500/t, while rebar prices fell by INR 100/t to INR 41,700/t today.
Price highlights
End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 5,000-5,300/t.
Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $385-$390/t, which equates to approximately INR 34,841/t (including freight), while local scrap, HMS (80:20), prices in Mumbai remained stable at INR 33,500/t today. In India, indicative prices of shredded scrap from Europe stood at $410-$415/t CFR Nhava Sheva.
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 13,450/t.
To see BigMint’s melting scrap assessment, pricing methodology and specification documents, Click here
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