Indian Steel Market Monthly Overview, March 2018

Indian Steel prices volatile in Mar’18 over bullish trends prevailing globally. However as per Indian medium & large steel mills, despite the price fluctuations in March they received healthy bookings for which dispatches still in the pipeline.

As per SteelMint assessment during the Mar’18, Indian billet & rebar prices of both medium & large mills was quite high than the buying interest by the global buyers specially from South East Asia.

Coming to monthly price movement as per SteelMint assessment, domestic Semi finished & long steel prices moved up by INR 500-1,500/MT (USD 7-23). Similarly, Flat Steel prices also rose by INR 600-1,200/MT (USD 9-19 ). However, the prices of key raw materials like Coal declined by USD 12/MT owing to improved supply.

The price changes mentioned are on monthly average basis of Mar’18 as against average prices of Feb’18 (Mar’18 Vs Feb’18).

Iron Ore & Pellets: India’s largest iron ore miner, NMDC had reduced iron ore prices by INR 90-120/MT for Mar’18. While, in recent for Apr’18 bookings the miner has surprised the steel makers by keeping iron ore prices unchanged from its Chhattisgarh mines.

— NMDC supplied 375 rakes of iron ore in Mar’18 which has increased as against in Feb’18 at 368 rakes. However, the miners iron ore exports decreased by 26% in Mar’18 to 40 rakes as against 54 rakes in Feb’18.

— In the last week of Mar’18, Jindal SAW (Rajasthan) reduced pellet offers by INR 500/MT. Offers for Fe 63% grade pellets are assessed around INR 6,400/MT (delivered Kandla).

— On an average basis Indian pellet Fe 63% 6-20 mm offers witness down by 4.48% M-o-M basis to INR 5,550/MT in Mar’18 which was INR 5,810/MT Ex-Barbil in Feb’18.

— On monthly average basis domestic iron ore Fe 62% 5-18 mm (Joda, Loaded to wagon) offers are remained same and are assessed at INR 5,800/MT.

Coking Coal: In the month, Coking Coal prices have continued to tumble, under the impact of over-supply coupled with feeble demand.

Offers for the Premium HCC have gone down by around USD 12/MT (4.93%) in Mar’18 and stood at around USD 229/MT CNF India.(monthly average)

Accumulation of unsold steel inventories of the Chinese steel makers on account of weak steel market has eroded demand for the coal as the steel plants ran at lower rates. Current spot offers for the Premium HCC were learnt to have come down to around USD 196.50/MT FoB Australia.

Scrap: Indian domestic HMS scrap offers rose by INR 400-1,400/MT (USD 6-21) M-o-M & assessed at INR 25,600/MT ex-Mumbai, West India & INR 25,700/MT ex-Chennai, South region. Although, in the same duration global offers stable & assessed at USD 360/MT CNF India from Europe & HMS (80:20).

In Mar’18, the Indian steel producers reported limited bookings as prices were on higher range. The monthly average price for HMS 1&2 reported at USD 382/MT in Mar’18 as compared to Feb’18 at USD 360MT from Middle East origin, CFR Nhava Sheva (West India).

— Recently, Salem Steel Plant (SSP), a unit of Steel Authority of India Limited (SAIL), concludes a global tender for purchase of around 20,000 MT Scrap. And as per the sources, tender was concluded at USD 449/MT for Shredded.

— As per vessel line up data maintained SteelMint stats, Indian bulk scrap imports was nil in the month of Mar’18 which was about 28,350 MT in Feb’18. The bulk scrap import during Feb’18 was reported by Mono Steel a big steel producer based in Western India.

Semi Finished Steel: On an average, domestic sponge prices increase marginally by INR 200-400/MT (USD 6-13) in March amid subdued demand by local Induction furnaces and due to improved supply. However, billet offers rose sharply by INR 400-1,400/MT following good inquiries.

— Indian sponge iron (DRI) export offers declined by USD 8-10/MT in Mar’18 on average basis. However, as compared to Mar’18 beginning offers, by the end of month it slump by around USD 35-40/MT. The current offers for 78-80 FeM Sponge C-DRI lumps stood at USD 357-360/MT, CPT Benapole (dry port of India & Bangladesh) & USD 380/MT CFR Chittagong.

— JSW Steel, India’s largest private steel producer has increased its gas based DRI (sponge iron) offers by around INR 500/MT (USD 8) for March, 2018 deliveries in the first week of month, while offers reduced to INR 22,000-22,500/MT (USD 353-361) in the mid of Mar’18. The current offers for FeM 80-82 DRI are reported at INR 21800-22,000/MT (USD 353-361), ex-plant, Dolvi, Maharashtra.

— In the initial days of month, Vizag Steel concludes 11,008 MT (equivalent to 4 rakes) billet export tender for Nepal at around USD 518-520/MT (ex-mill) and the buyers are heard Panchakanya Steel and Himal Iron & Steel, the prime rebar producers based in Birgunj/Bhairahawa in Nepal. While in the mid of month, Vizag Steel concludes billet export tender of 150*150mm (5,000 MT) at around USD 515-520/MT, FoB India and 75*75mm (10,000 MT) billet around USD 520-525/MT, FoB India. Further, in recent a export tender had concluded of 15,000 MT (200*200 mm) at around UD 505/MT, FoB India.

— Indian private Pig iron manufacturers have increased prices by INR 1,000-2,500/MT (USD 8-24) on monthly average basis in Mar’18.

— In the last week of Mar’18, Tata Metaliks, India’s one of the largest foundry grade pig iron manufacturer has raised its prices by INR 800/MT (USD 12) & reported at INR 32,400/MT(Ex-Kharagpur) for high silicon, foundry grade Pig iron.

Long Steel: Finish Long Steel Price assessment has slightly gained over volatility in prices as producers booked with healthy orders.

Assessed prices by medium/small producers have been evolved by around 2% (INR 600-700 ) monthly. Similarly, the large scale producers have increased finished steel prices by around INR 1,000-1,250/MT (USD 15-19) in the initial days of Mar and the price range for Rebars (12 mm) stood at INR 44,500-45,000/MT ex-Mumbai and excluding 18% GST.

— Finish long (Bar & rods, Structures and excluding pipes) steel production by both large and medium/small scale producers stood at 3.85 MnT in Feb’18 went down by around 3.27% compared with 3.98 MnT in Jan’18.

— During the month, medium steel plants in Jalna have increased rebar gauge parity by INR 300/MT in all sizes w.e.f. 26.03.18 and further Wire Rod suppliers from Central region- Raipur have spread discount to INR 1,600-1,800/MT for specific days to boost demand and current discount level heard to be around INR 1,000-1,200/MT.

Flat Steel: On monthly average basis in Mar’ 18, Domestic Flat steel prices surged by INR 600-1,200/MT (USD 9-19).

— Indian major steel-makers namely- JSW Steel and SAIL have raised the flat steel prices by INR 1,000/MT in March over supply constraints coupled with higher coking prices from Australia.

— Meanwhile fire breakout which took place at SAIL Bokaro hot strip mill and has affected the production in hot rolled strip mill and lead to material shortage (flat steel) in domestic market.

However by the end of Mar’18 Indian flat steel prices witnessed decline in traders market by INR 500-1,000/MT due to sluggish demand over higher prices prevails in the domestic market.

— Indian HRC export offers witness decline – Indian mills have cut HRC export offers by about USD 10/MT. Currently HRC export offers are assessed in the range of USD 640-650/MT FoB India which is equivalent to USD 680-690/MT CFR Europe.

Monthly Average Prices – Mar’18 Vs Feb’18

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

Indian Export Reference Prices as on 5th Apr’18

Prices in USD/MT
Source: SteelMint Research