- Sponge iron prices up by INR 200/t d-o-d
- Semis, finished steel prices sharply up today
- RCM effect witnessed in Mandi scrap market
BigMint’s domestic end-cutting scrap index tracking the Mandi Gobindgarh market rose by INR 100/t to INR 36,000/t DAP today.
No significant improvement has been observed in the major markets regarding scrap procurement by mills, with purchases being made only on need basis. Bid-offer disparities continue to persist due to the Reverse Charge Mechanism (RCM) implemented by the government.
A scrap supplier said, scrap inflows from neighbouring states have declined recently. Many scrap sellers are hesitant to proceed as buyers are offering very low margins, making it unfeasible for suppliers to conduct business, as no one can afford to operate at a loss.
Raw materials overview
Sponge iron (CDRI) prices rose by INR 200/t to INR 30,000/t DAP in Mandi, driven by moderate trading activity. With major mills delaying scrap purchases, sponge iron usage has grown in their steel production processes. Additionally, in Ludhiana, pig iron (steel grade) prices remained stable at INR 38,100/t DAP.
Raw material prices have maintained a consistent downward trend over the past three months.
Steel market
In the Mandi region, steel ingot prices sharply up by INR 100/t to INR 41,200/t during the price reporting and normalisation phase. Meanwhile, prices in other key markets increased by INR 100/t to INR 300/t. But the most notable improvement was seen in the Raipur steel market as semis prices upped by INR 300/t d-o-d.
Rebar (Fe500) prices in Mandi moved down by INR 200/t to INR 46,000/t exw, amid limited trades.
Rebar prices have been steadily declining over the past three months.
Overview of Alang market
On 13 Sep’24, Gujarat’s Alang market saw ship-breaking melting scrap prices fall by INR 500/t, with HMS (80:20) now priced at INR 33,000/t ex-yard, according to BigMint. Diminished demand for semi-finished and finished steel, coupled with reduced scrap trade activity, led to price cuts from suppliers. Additionally, semi-finished steel prices dropped by INR 300/t d-o-d, while bid-offer disparities remained prominent in key markets.
On a weekly basis, HMS (80:20) scrap prices in Alang dropped by INR 1,000/t.
Price highlights
End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 5,200/t.
Domestic vs imported scrap: Imported melting scrap prices at the Nhava Sheva Port were at $365-$370/t, which equates to approximately INR 33,244/t (including freight). Meanwhile, local scrap HMS (80:20) prices in Mumbai fell by INR 200/t to INR 32,300/t DAP. In India, indicative prices of shredded scrap from Europe stood around $385-$390/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 12,550/t.
To see BigMint’s melting scrap assessment, pricing methodology and specification documents, Click here
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