Indian Steel Market Highlights, Week 40

Indian Steel market moved down further in week-40 (29th Sep) as domestic Semis and Finished offers registered fall of INR 400-1,200/MT (USD 6-18), W-o-W.

In current circumstances trade activities remain dull owing to an inert mood of buyers and festive holidays.

Raw Material: Indian private miner like, Serajuddin Mines from Odisha was supposed to resume iron ore dispatches from Wednesday (27/09/17) post physical verification of stocks after the official clearance according to the latest update.

According to participants, market price based on index should be around 113-114/MT CFR, China but Chinese mills were willing to pay a premium for prompt delivery and high quality due to sintering and pelletizing restriction imposed by Chinese government in key steel producing areas. However domestic pellet prices have gone down by INR 200-300/MT owing to falling sponge prices.

Meanwhile, Imported scrap offers to India have come down by around USD 10-20/MT W-o-W, however buying interest seen around USD 15-20 lesser than present levels. Also, buyers preferred domestic scrap over imported one. As per assessment offers for HMS 1&2 (80:20) in containers for Dubai origin stood in the range of USD 290-300/MT, CFR Nhava Sheva. Offers for Shredded scrap also fell in this week for both UK and Europe origins and now assessed in the range of USD 310-320/MT, CFR Nhava Sheva. Indian domestic scrap fall by INR 500-700/MT (W-o-W) and are assessed at INR 20,000-20,200/MT ex-Mumbai for HMS grade.

Coking Coal: Coking Coal prices are now sliding down, after a wave of steep rise. The main driver of the downward traversal in the prices is the erosion of demand arising on account of the bearish sentiments among the Chinese steel makers due to the imminent steel production cuts to be implemented in China. Offers for the Premium HCC have declined to around USD 202-203/MT CFR India against last week at USD 221-223/MT and further down slides are on the anvil.

Semis Finished Steel: Domestic billet and sponge offers continue to fall since start of the month amid weak demand and lower export orders. In a week’s duration, domestic Sponge & Billet offers fall in the range of INR 400-1,200/MT (USD 6-18). In the period major fall in sponge iron seen in Central India by INR 1,000/MT (USD 15) & for Billet in Western India by INR 1,200-1,300/MT (USD 18-20).

On weekly basis, Indian billet export offers fall by USD 15-20/MT following the downtrend in global market. Steel Authority of India (SAIL) had floated a tender for export of around 18,000 MT billets. According to market sources report to SteelMint, the company received bids around USD 475-480/MT, FoB India. If sources are to be believed the company seems to have cancelled the export tender as they were expecting higher bids. SteelMint’s billet export price assessments are stood at USD 490-500/MT FOB India against last week at USD 520/MT FoB.

Further, Indian domestic pig iron market offers decline around INR 500/MT (USD 8) due to falling steel prices in the country and slump in global coking coal & scrap prices. Following the trend export offers also slip by USD 10/MT W-o-W and are evaluated at USD 370-390/MT, FoB India.

Finish Long Steel Market: With decline in semis market the Finished long offers registered fall of INR 400-1,100/MT on weekly basis in Rebars and the major price fall seen in Mumbai (Western India).

Flat Steel Market: India witnessed further decline in flat steel prices by INR 500-700/MT, W-o-W. Ongoing festive holidays amid weak buying interest in domestic market resulted to fall in prices. Domestic markets are likely to resume trade activities from next week.

Besides this, arriving import bookings are also another factor pressurising domestic prices.

Indian Raw material and Finished Steel reference Prices as on 29 Sept (Week 40)

Prices are Ex-works, Exclusive of GST at 18%

Indian Export Reference Prices

Source: SteelMint Research