- Scrap market unaffected by poor steel demand
- Prices to remain range-bound in near term
HMS (80:20) scrap prices in Chennai remained stable at INR 31,500/tonne (t), showing no change on a d-o-d or w-o-w basis, according to BigMint’s latest assessment. Similarly, rebar prices held steady at INR 48,500/t in both d-o-d and w-o-w evaluations. Meanwhile, billet prices decreased by INR 500/t w-o-w while remaining stable d-o-d at INR 43,500/t.
Market activity indicates a mixed trend, with stability in daily pricing and minor fluctuations over the week.
Imported, domestic price trends
A scrap trader stated that offers for shredded from Australia were at $365-370/t CFR Chennai, while HMS 80:20 was available at $350-355/t. However, despite these competitive prices, demand for imported scrap in Chennai was weak, with limited buyer interest in these offers.
Meanwhile, a source disclosed that some mills placed orders for two vessels of sponge pellets from the Middle East and Africa. However, confirmation from the buyers is still pending.
Domestic HMS (80:20) was sold at INR 31,000-31,500/t for buyers opting for immediate payment. For transactions involving extended credit terms, pricing was slightly higher, in the range of INR 31,500-32,000/t. Most offers and concluded deals were concentrated within the INR 31,000-32,000/t range, reflecting a stable pricing environment and a preference for prompt payment terms in the current market.
Buyer-supplier sentiments
According to a mill representative, recently, trade activities in the steel sector have slowed down considerably. Both large-scale project sales and retail transactions have seen a downturn, which has translated into a reduction in demand for finished steel products. As a result, steel mills are beginning to feel the pressure of rising inventory levels. If demand continues to wane, there is a possibility of a further downtrend in the steel market in the near future.
A scrap supplier stated that the price range for HMS 80:20 scrap currently stood at INR 31,000-32,000/t, with variations based on payment terms. Despite recent declines in billet prices, scrap has not yet seen any reductions. Buyers have been maintaining their scrap procurement prices at these levels.
Regional comparison
The Jalna steel market remained stable d-o-d, with billet, rebar, and HMS 80:20 prices unchanged at INR 42,400/t, INR 49,000/t, and INR 32,800/t, respectively. Market sentiment was steady, supported by moderate trade volumes. Scrap inflows to mills were well aligned with production requirements, reinforcing stable supply dynamics at existing price points.
Outlook
Despite the current slowdown, scrap prices are expected to remain within a relatively narrow range in the near term, with potential fluctuations of +/- INR 500/t. These fluctuations will be influenced by prevailing market conditions, which may affect price stability in the short term.
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