- Scrap prices Stable scrap as billet, rebar gain w-o-w
- Steel recovery fails to lift scrap prices
According to BigMint’s latest assessment, HMS (80:20) scrap prices in Chennai remained stable at INR 30,800/t, with no change observed on either a day-on-day or week-on-week basis. In the semi-finished steel segment, billet prices remained unchanged d-o-d at INR 43,000/t, while recording a weekly increase of INR 1,000/t. Similarly, rebar prices held steady on a daily basis but advanced by INR 1,000/t w-o-w to INR 47,000/t, supported by improved trading activity.
However, finished steel demand continued to remain at a moderate level, and persistent liquidity constraints across the market limited overall trading activity, prompting mills to maintain a cautious and requirement-based procurement strategy.
Imported, domestic price trends
According to market participants, Australia-origin shredded scrap was offered at $365-370/t CFR Chennai, while HMS (80:20) was quoted at $325-330/t CFR. Import demand remained weak, with buyers quoting bids approximately $15-20/t below sellers’ offer levels, resulting in a wide bid-offer gap.
Market participants noted that domestic scrap continues to offer a more economical procurement option compared to imported material, prompting mills to avoid fresh overseas bookings. Consequently, import trading activity remained limited despite relatively tight domestic scrap availability, with mills continuing to procure material primarily from the domestic market.
In the domestic market, HMS (80:20) scrap prices were quoted at INR 30,500-31,000/t for spot transactions, while credit-term deals were concluded at INR 31,000-31,500/t. Overall, trading activity remained concentrated within the INR 30,500-31,500/t range. Market participants noted that mills continued to procure scrap only against immediate production requirements, with transaction prices primarily influenced by payment terms, procurement volumes, and mill-specific requirements, keeping overall market activity stable.
Buyer-supplier sentiments
According to a mill representative, sponge iron prices have increased week-on-week, as suppliers from neighbouring states revised their offers upward. However, buyers remain reluctant to accept higher prices and are largely maintaining a wait-and-watch approach before making fresh purchases. The representative further noted that billet and rebar prices have recovered on a week-on-week basis, supported by an improvement in finished steel trading activity over the past few days compared with the previous couple of weeks.
Separately, market sources reported that a billet export deal from Chennai to Sri Lanka was concluded at approximately INR 44,200/t FOB Chennai, indicating improved demand for semi-finished steel and supporting overall market sentiment.
A scrap supplier shared with BigMint that HMS (80:20) scrap prices are currently ranging between INR 30,500-31,500/t, with transaction values differing according to payment terms and mill-specific requirements. The supplier explained that despite the recent recovery in billet and rebar prices, mills have refrained from increasing their scrap procurement prices, as they remain focused on managing production costs and preserving conversion margins amid only moderate finished steel demand.
Current price variations are primarily influenced by requirement-based procurement, payment terms, and order volumes, rather than broader market sentiment. As a result, the domestic scrap market has remained largely stable, with balanced buying activity preventing any significant change in prevailing price levels.
Outlook
The near-term outlook for the Chennai scrap market remains cautiously stable, with mills expected to continue requirement-based procurement amid moderate finished steel demand. Domestic scrap availability is likely to remain balanced, while higher imported scrap offer levels may continue to discourage fresh bookings. Overall, HMS (80:20) scrap prices are expected to remain range-bound, with fluctuations limited to around INR +/- 200-500/t.
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