The performance of Indian steel industry in first quarter of FY17 can be rated as average with both improvements and deterioration in raw material, semis, and finished steel prices.
The impact of MIP announced on173 steel products in Feb’16 can be seen in the domestic prices and import numbers of flat steel products which have registered increase in Q1 of FY17 against previous quarter.
Whereas, MIP has limited impact on the prices of billet and long steel products amid sluggish demand.
We at SteelMint have analyzed and compared the Indian steel industry performance in Q4 FY16 and Q1 FY 17.
Prices:
In Q1 FY17, domestic prices of iron ore have registered fall with highest fall of 17% from Odisha. Also pellet prices have fallen by 3% against previous quarter. Whereas scrap domestic prices have increased by 4% this quarter.
Semis and rebar domestic prices have registered an insignificant fall. While, flat products prices have increased by 26% on an average basis in Q1 FY17 against previous quarter.
Production:
India’s crude steel production have remained almost stable at 23.4 MnT in Q4 FY16 and 23.8 MnT (provisional fig.) for Q1 FY17.
It is being anticipated that India’s crude steel production is likely to increase by about 4 MnT in current fiscal. This is backed by increased production from Indian steel majors like JSW Steel, Essar Steel, BHushan Steel and Tata Steel.
Export/Import:
In terms of imports, India’s raw material, long steel and flat steel imports have registered a fall of 22%, 52% and 48% respectively in Q1 FY17 against previous quarter. Fall in iron ore imports can be contributed to domestic availability of iron ore. Whereas, drop in long and flat steel imports can be contributed to MIP imposition.
India’s coking and non coking coal imports have increased in by 10% and 5% respectively because of increased requirement of the same for steel production by domestic manufacturers.
In export terms, India’s iron ore, flat steel, and long products exports have increased by 44%, 43%, and 187% respectively owing to sudden plunge in global prices of the products from April end till early May.
| Commodity | Delivery | Size/Grade | Unit Prices | Q4 FY16 | Q1 FY 17 | % Change | Q1 FY16 | % Change | Remark |
| Iron Ore | NMDC (Chhattisgarh) |
Lumps, 6-40mm, Fe 65% | INR/MT | 1,875 | 1,900 | 1% | 3,050 | -38% | Excluding Royalty |
| Iron Ore | NMDC (Chhattisgarh) |
Fines, -10mm, Fe 64% | INR/MT | 1,635 | 1,630 | -0.30% | 1,960 | -17% | Excluding Royalty |
| Iron Ore | Odisha | Fines, Fe 63% | INR/MT | 1,400 | 1,160 | -17% | 1,700 | -32% | Ex-mines, Including Royalty |
| Iron Ore | Odisha,Sponge grade Lump |
5-18 mm, Fe 63% | INR/MT | 2,150 | 2,100 | -2.30% | 4,050 | -48% | Ex-mines, Including Royalty |
| Iron Ore | Karnataka, Fines | Fe 58% | INR/MT | 840 | 1,275 | 51% | 1,320 | -3% | Weighted average bid price, Basic |
| Pellets | Ex- Barbil | 6-20mm,63% | INR/MT | 3,100 | 3,000 | -3% | 4,800 | -38% | Basic Prices, Loaded to Wagons |
| Scrap | Ex-Mumbai | HMS 80:20 | INR/MT | 15,700 | 16,300 | 4% | 20,700 | -21% | Basic Prices, Excise and VAT/CST Extra |
| Scrap | CIF, Mumbai | HMS 80:20 (Europe) | USD/MT | 195 | 231 | 18% | 275 | -16% | |
| Met Coke | CFR India | 62% CSR | USD/MT | 120 | 168 | 40% | 165 | 2% | |
| Pig iron | Ex-Durgapur | Steel Grade | INR/MT | 17,300 | 18,250 | 5% | 18,400 | -1% | Basic Prices, Excise and VAT/CST Extra |
| Sponge Iron | Ex- Raipur | FeM 80 (+/-1) | INR/MT | 13,150 | 12,400 | -6% | 17,000 | -27% | Ex- Works, Excise and VAT/CST Extra |
| Pellet Sponge | Ex- Raipur | FeM 80 (+/-1) | INR/MT | 12,000 | 11,100 | -8% | 15,300 | -27% | Ex- Works, Excise and VAT/CST Extra |
| Billet | Ex- Mumbai | 100*100mm | INR/MT | 23,750 | 23,450 | -1% | 27,850 | -16% | Ex- Works, Excise and VAT/CST Extra |
| Rebar | Ex-Mumbai | 12mm | INR/MT | 27,200 | 26,700 | -2% | 30,800 | -13% | Ex- Works, Excise and VAT/CST Extra |
| Wire Rod | Ex-Raipur | 5.5mm | INR/MT | 26,700 | 27,200 | 2% | 29,700 | -8% | Ex- Works, Excise and VAT/CST Extra |
| HR Coil | Ex-Mumbai | 2.5mm, IS 2062 | INR/MT | 32,100 | 35,150 | 10% | 35,350 | -1% | Including Excise of 12.5% ; VAT Extra |
| HR Coil | FoB India | 2mm, SS 400 (China) |
USD/MT | 300 | 430 | 43% | 385 | 12% | |
| HR Plates | Ex- Works | 5-10mm | INR/MT | 26,200 | 30,900 | 18% | 30,100 | 20% | Ex- Works, Excise and VAT/CST Extra |
| CR Coil | Ex-Mumbai | 0.9mm | INR/MT | 35,250 | 40,270 | 14% | 40,100 | 0% | Incld Excise of 12.5% ; VAT/CST Extra |
| SiMn | Ex- Raipur | 60/14 | INR/MT | 45,190 | 50,460 | 12% | 46,350 | 9% | Ex- Works, Excise and VAT/CST Extra |
| Other Country | |||||||||
| Coking Coal | FOB Australia | Premimum HCC | USD/MT | 85 | 100 | 18% | 88 | 13% | |
| Pig iron | FoB Black Sea | Steel Grade | USD/MT | 185 | 265 | 43% | 258 | 3% | |
| Billet | FOB Black Sea | 125*125mm | USD/MT | 270 | 355 | 12% | 365 | -8% |
Source: SteelMint Research
| Production | Country | Q4 FY16 | Q1 FY17* | % Change | Q1 FY16 | % Change | Remarks |
| Crude Steel | India | 23.4 | 23.68 | 0.01% | 22.7 | 0.04% | *Provisional data for June has been taken |
| Export | |||||||
| Iron ore | India | 4.16 | 5.97 | 44% | 0.04 | 148.25% | |
| Pig Iron | India | 0.03 | NIL | – | 0.18 | – | |
| Long Steel | India | 0.015 | 0.04 | 187% | 0.1 | -60% | * Provisional data for Jun’16 |
| Flat Steel | India | 0.67 | 0.96 | 43% | 0.75 | 8% | * Provisional data for Jun’16 |
| Si Mn | India | 0.11 | 0.07 | -36% | 0.16 | -54% | * Provisional data for Jun’16 |
| FeCr | India | 0.11 | 0.11 | 0 | 0.11 | 0 | * Provisional data for Jun’16 |
| FeMn | India | 0.03 | 0.02 | -33% | 0.02 | 0 | * Provisional data for Jun’16 |
| Import | |||||||
| Iron ore | India | 1.89 | 1.47 | -22% | 2.14 | -31% | |
| Coking Coal | India | 10.87 | 11.98 | 10% | 11.79 | 0.02% | |
| Non coking Coal | India | 41.64 | 43.8 | 5% | 47 | -7% | |
| Scrap | India | 1.7 | 1.75 | 3% | 1.59 | 10% | *6 Provisional data for Jun’16 |
| Long Steel | India | 0.25 | 0.12 | -52% | 0.21 | -43% | * Provisional data for Jun’16 |
| Flat Steel | India | 2.36 | 1.22 | -48% | 1.69 | -28% | * Provisional data for Jun’16 |
Quantity in MnT
Source: SteelMint Research
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