Indian Steel Market Weekly Snapshot

Indian steel market remained bearish in week-51 (17-22 Dec) owing to lessen trade activities in domestic market. As per producers in major markets, disruption of demand-supply chain amid fall in raw material prices have pressurised them to reduce prices.

As per SteelMint assessment, during the week prices of Billet have declined by INR 200-1,200/MT (USD 3-17 ) & Long steel – Rebar prices slump by INR 200-400/MT (USD 3-6) in across major producing markets.

Inline Flat steel, the prices registered fall of about INR 500-1,000/MT (USD 7-14) in traders market over less buying interest.

Iron ore & Pellets: Odisha based merchant miners Serajuddin and Essel mine have slashed iron ore prices this week. They have cut its iron ore lump prices by INR 400/MT and fines prices by INR 300/MT.

— This week pellet prices in Indian domestic market witnessed decline further and market also observed limited trades. Durgapur pellet prices have witnessed down by INR 100-200/MT to INR 6,400/MT this week against last week’s assessment of INR 6,500-6,700/MT.Current assessment for Raipur pellet stands at around INR 6,200/MT (ex-Raipur) against the beginning of this week assessment at INR 6,200-6,500/MT.

— As per market sources report to SteelMint, Chinese inquiries for Indian pellet have increased at around USD 110-111/MT, CFR China levels for regular grade pellet with 3% alumina.

— Eastern India based pellet maker-Brahmani River Pellets concluded pellet export deals to Indonesia for 60,000 MT at USD 110/MT, CFR Indonesia.

Coal: Australian premium hard coking coal prices slipped as Chinese steel margins decline, although prices for the 64 Mid Vol HCC grade remained relatively stable. In the FOB market, recent concerns over adverse weather conditions in Queensland eased as Cyclone Owen dispersed bearing minimal impact than feared. Also, vessels queue at the Dalrymple Bay Coal Terminal now appears to be normal.

In China, the buying interest has slowed down, as most purchase requirements have already been fulfilled earlier in consideration of bad weather conditions in Australia. Moreover, the Chinese buyers are heard to be concerned over softer steel margins, because the overall outlook for Q1 2019 steel market still remains under pressure. Traders believe that there is further room for price decreases in the premium low-vol hard coking coal segment.

Latest prices for the Premium HCC and 64 Mid Vol HCC grade are assessed at around USD 226/MT and USD 186.50/MT FOB Australia respectively. For Indian buyers, the above offers amount to USD 239/MT and USD 199/MT respectively on CNF India basis.

Scrap: Indian imported scrap market continues silence on weak demand and falling domestic semi-finish and scrap prices this week. No buying interest is seen from buyers as they are eyeing for a further decline in prices on bearish global sentiments. SteelMint’s assessment for imported scrap hit more than 1 years’ low and fell by around USD 5-10/MT on W-o-W basis.

SteelMint’s assessment for containerised Shredded scrap stands in the range of USD 325-330/MT, CFR Nhava Sheva. Limited offers for HMS 1 heard at around USD 320-325/MT, CFR and assessment of West African HMS stands at around USD 305-310/MT, CFR

Semi finished: Indian billet prices remain down trend this and slump by INR 200-1,100/MT. In these period major fall of INR 1,000-1,200/MT in billet seen in Mandi Gobindgarh due to limited inquiries amid falling raw materials. Inline as per the data maintained by SteelMint, Central & Eastern India Billet prices hit 1-year low.

Further, Sponge iron offers being reduced by INR 300-900/MT on healthy supply amid falling Ingot/Billet productions due to low margins on sharp fall in prices.

Another key factor behind slump in Sponge prices was declining raw materials – Iron ore & pellet prices which in recent fall by around INR 300-500/MT (USD 4-7)

— Indian Sponge iron export offers to Bangladesh for FeM 78-80 is hovering at USD 325-330/MT CPT Benapole (dry land port of Bangladesh & India) and USD 345-350/MT, CFR Chittagong. The prices are firm against last week assessment.

— The latest Billet export offers through the Durgapur, eastern India based mills fall by USD 5/MT on decline in domestic prices and reported for Induction grade (100*100mm) at around USD 435/MT, as against last day at USD 440/MT (ex-mill).

— SAIL has invited a global tender for purchase of 30,000 MT Carbon Steel Slab for its Salem Steel Plant, Tamil Nadu. The due date of bid submission is 21 Jan’19 at 15:00 hrs IST

— Vizag Steel also known as RINL (Rashtriya Ispat Nigam Limited)- the state-owned steel maker under the Ministry of Steel, has been concluded Billet (90-90mm) export tender to Nepal at around USD 450/MT close to the highest (H1) bidder for 2,709 MT (equivalent to 1 rake), as per sources.

— Neelachal Ispat Nigam Ltd (NINL), India’s largest and state owned steel grade pig iron manufacturer & exporter has reduced pig iron prices by INR 500-600/MT (USD 7-9). The offers was floated for Steel grade at INR 27,900/MT (USD 393), N2 grade at INR 28,500/MT (USD 402) & Foundry (High silicon) grade at INR 29,000/MT (USD 409); prices are basic, ex-Cuttack, East India.

— MMTC- India’s largest and state owned trading house, has floated export tender of 30,000 MT non-alloy Pig Iron on behalf of Neelachal Ispat Nigam Limited (NINL). The due date for submission of bids is 14:30 hrs on 08 Jan’19.

— Jindal Steels offer for Steel grade pig iron at INR 28,800/MT ex-plant Raigarh, Panther shots (Granulated pig iron) at INR 27,800/MT & Pooled iron at INR 26,800/MT ex-plant, Odisha.

— Vizag Steel Pig iron export tender receives dull response amid falling global prices. CIS Pig iron export offers fall to USD 345-350/MT, FoB Black Sea

— SteelMint’s Pig iron export price assessment stood at USD 355-365/MT FoB India, USD 340-345/MT FoB Brazil and USD 345-355/MT FoB Black sea.

Finish Long Steel market remains weak over dull sentiments in overall regions and price range reduced by around INR 400-600/MT (TMT/Structure).

Particularly, North region based re-rollers have provided interesting discounts to boost trade volume but couldn’t elongate the appropriate sales through traders & retailers.

– The trade reference rebar (12-25 mm) prices assessed at INR 36,600-37,000/MT Ex- Jalna & INR 34,500-34,800/MT Ex- Raipur, excluding GST.

In the past week, central region based heavy structure manufacturers have decided to provide the maximum discount of INR 500/MT than the earlier at around INR 800-900/MT upon booking quantity and current trade reference prices stood at INR 41,000-41,200/MT (200 Angle) & INR 35,100-35,300/MT (50 Angle).

However supply of Light/Medium Structures from Raipur to western regions continued and landed cost in Mumbai reported at around INR 37,300/MT (50/6 Angle) and freight cost is about INR 2,300-2,400/MT, as per trade sources. Further, the market participants have anticipated that slight price corrections may report soon due to lack of buying inquiries.

— Wire Rod trade discount offered by the manufacturers/suppliers in Raipur has slightly increased compared to last week which is now about INR 1,000-1,400/MT as per sources. However trade discount on HB wire is less at around 600-800/MT due to shortage of material.

— Vizag Steel (RINL) has made second revision of rebar prices in the current month, as per our sources. The company has increased existing discount in rebar upto INR 700/MT for specific location & depending on the lifting. The new prices would be applicable from 17 Dec’18.

— Currently the large mills are offering rebar in the range of INR 40,700-41,100/MT, whereas medium mills are offering at INR 36,300-36,500/MT ex-Mumbai, size 12 mm & excluding GST.

Finish Flat Steel: Amid sluggish trades and low buying interest in domestic market, prices declined further in traders market by INR 500-1,000/MT this week. As per the data maintained with SteelMint, domestic HRC prices in traders market is hovering close to an year low. Similar price levels were recorded in the month of Jan-Feb’18.

Current trade reference prices for HRC (IS2062) 2.5 mm-8 mm is around INR 43,000-43,500/MT (ex-Mumbai) and INR 42,500-43,000/MT (ex-Delhi). The prices for CRC (IS513) 0.9 mm is hovering in the range of INR 48,500-49,500/MT(ex-Mumbai) and INR 48,500-50,000/MT (ex-Delhi).The prices mentioned above are basic prices excluding GST@18% on cash payment basis.

Thus cost effective imports following significant decline in global prices in turn led to weakening HRC prices in domestic market.Indian steel mills are also providing considerable discounts and rebates to buyers in order to push buying in domestic market.

Meanwhile raw material prices like iron ore has also slashed this month which lead to softening HRC prices in domestic market.

Indian Raw material and Finished Steel reference Prices as on 22 December 2018 (Week 51)

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

Indian Export Reference Prices as on 22nd December’18

Prices in USD/MT
Source: SteelMint Research