- Scrap prices pressured by weak buying sentiment
- LME nickel prices drop slightly, inventories still elevated
India’s stainless steel scrap prices continued to face pressure this week due to weak buying interest and ample scrap availability in the domestic market. Additionally, increased usage of alternative raw materials such as nickel pig iron (NPI) as well as semi-finished products has further tempered demand for scrap.
BigMint assessed 304-grade domestic scrap at INR 111,000/t ex-Delhi, down INR 3,000/t w-o-w, while imported 304-grade scrap from nearshore origins was assessed at $1,230/t CFR Mundra, down $10/t w-o-w.
Market sentiments
Domestic stainless steel scrap prices continued to soften as production costs eased, influenced by declining coil prices and subdued demand. According to market participants, downstream activity remains weak and the anticipated post-festive recovery has not materialised, keeping buying sentiment low. Mills have also reduced their procurement prices by around INR 2,000-3,000/t for 304 scrap in the domestic market, further pressuring trade-level scrap offers and contributing to a cautious outlook.
A market participant said, “Overall market performance remains weak. The major mills are increasingly offering billets and NPI in the market, which has reduced reliance on scrap. This has further weighed on scrap demand and kept prices under sustained pressure.”
Global updates
South Korea’s POSCO has suspended operations at its stainless steel plant in Pohang following a gas leak incident during maintenance activities at the annealing and pickling line. The company is conducting thorough safety inspections, while authorities have initiated an investigation into the cause of the leak and the plant’s safety measures to ensure worker safety.
A Korean trader clarified that production has not come to a halt yet. However, from this month onwards, POSCO agents have slowed down their scrap purchases due to sufficient inventory levels, and the company’s intake pace has moderated.
The trader also noted that Korea’s domestic prices have been elevated for the past few months. The intake of SS304 scrap is expected to remain slow and limited, as domestic prices continue to be higher compared to Japan, China, Taiwan and India. SS304 domestic prices are currently around KRW 1780-1800/t, which translates to approximately $1300/t CFR India.
There have been no SS304 exports over the past 4-5 months, and this trend is likely to continue into next year. Additionally, sea freight rates from Korea to India are projected to rise.
BigMint’s scrap assessments
- Nearshore-origin SS 316 scrap (loose): $2,500/t, steady w-o-w.
- Nearshore-origin SS 201 scrap (loose): $630/t, down $15/t w-o-w.
- Nearshore-origin SS 430 scrap (loose): $560/t, steady w-o-w.
- SS 316 scrap ex-Delhi: INR 214,000/t, down by INR 3,000/t w-o-w.
- SS utensil ex-Delhi: INR 60,000/t, up by INR 1,000/t w-o-w.
LME nickel tags
Nickel prices on the London Metal Exchange (LME) dropped slightly, with the three-month contract at $15,038/t, slightly down by 1% versus $15,245/t last week. LME-registered nickel stocks stood at 253,104 t as against 251,640 t in the previous week.
Outlook
In the near term, market sentiment is expected to remain cautious, with participants anticipating further price corrections in both the finished stainless steel and scrap segments.
Leave a Reply