SteelMint’s billet price index increased by over INR 1,000/t to INR 28,750/t, Exw Raipur on 24 July, as compared to the last week.
Factors that increased prices are:
- Sponge iron prices have increased by INR 700-1,000/t over the week on the back of gain in iron ore pellet, fines and lump prices in the domestic market due to tight supplies. Most pellet makers have booked export cargoes until August. Prices have increased by INR 100-700/t w-o-w. Limited supplies in Odisha due to rains and tightening high-grade fines and lump stocks with miners have lifted prices of these ores.
- Active buying from pipe mills that use Patra (strips made using billets) have supported billet prices this week. Prices and demand for billet may increase further following higher HRC prices in the near-term. Downstream pipe buyers may switch to Patra-based pipes from HRC-based ones, amid speculation that major integrated mills could lift HRC prices by up to INR 2,000/t in August which could lead to steep hike in prices of HRC based pipes. Further, a shortage of thin-gauge HRC in the domestic market could squeeze the availability of HRC pipes and increase demand for patra pipes.
What is SteelMint Billet Index?
SteelMint has introduced a new daily price index for induction-route billet cargoes on an ex-works Raipur (Chhattisgarh) basis.
The index considers billet cargoes that comply with Steelmint’s quality and quantity specifications. The index also adopts internationally-accepted IOSCO principles of transparency, widest possible coverage of market participants, and consistency for spot price assessments. The index determines prices based on a published methodology that describes hierarchy of market data, price calculation, normalization and market data exclusion principles.
The index places the highest value on concluded deals that have been confirmed by reputed and trustworthy buyers, sellers and brokers but also included confirmed bids and offers in the price calculation process.
Methodology: https://bit.ly/3jcmGL6
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