SteelMint’s scrap index fell to the lowest level in four weeks, while end-user demand for steel on the market still remains abysmal.
The domestic steel scrap (end-cutting) index fell by INR 600/tonne (t) to INR 45,500/t DAP Mandi Gobindgarh on 25 August, 2022.
Amidst uncertain price movements in semi-finished and finished steel, buyers opted for a wait-and-watch approach, which led to subdued trading in the spot market throughout the day, sources informed.
Traders expect ferrous scrap prices to remain under downward pressure because of bulk steel scrap arriving at Indian ports.
There was a slight improvement in the Jalna market, with HMS (80:20) rising by about INR 300/t to INR 43,300/t delivered at plant because approximately 13,000-15,000 t of finished steel was sold in yesterday trading session.
Market highlights
End-cutting and ingot spread: In Mandi, the end-cutting scrap and ingot spread remained unchanged today at INR 5,800-6,000/t.
Domestic and imported scrap price gap: In yesterday’s trading session, imported HMS 1&2 (80:20) was traded at a range of $465-475/t (INR 37,150-37,950) CNF Nhava Sheva. Including freight the cost comes to INR 39,500-40,500/t ex-works. Since domestic scrap is about INR 2,000-3,000/t higher, Mumbai-based mills and those in the nearby regions are prefering to buy imported scrap.
Raipur sponge iron-billet spread: The current conversion spread (margins) from pellet-based DRI (P-DRI) to steel billet in Raipur stands at around INR 14,000/t.
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