Indian Steel Market Weekly Snapshot

Indian steel market observed surge in price range in week 21 (18-25th May’19), however trades were limited over the announcement of election results in the country.

As per assessment, during the week prices of Semis & Finished steel products through the mid size mills surge approximately by INR 200-700/MT (USD 3-10) in across major Indian markets on increased raw material offers. However trade remains dull in Flat steel products resulted fall in offers by INR 500-1,000/MT in traders market.

IRON ORE & PELLET

NMDC Ltd – India’s biggest iron ore producer has announced a hike in its iron ore prices for June deliveries on 24th May’19. The miner has raised Baila lump and fines price by INR 250/MT (USD 3.6) and INR 290/MT in DRCLO as per sources.

Essel Mining – a major iron ore mine in Odisha has increased its offers for iron ore lumps by INR 300/MT (USD 4/MT) and INR 250/MT in fines (USD 3.5/MT) w.e.f 23rd May’19. Odisha stands at INR 4,000-4,300/MT (ex-mines) for 5-18 mm and INR 2,000-2,200/MT for fines Fe 63%.

— Indian pellet prices rise sharply amid increased exports, hike in Iron ore prices and incline in Sponge iron offers. In Durgapur (Eastern India) prices hike by around INR 900-1,000/MT W-o-W to INR 6,900-7,000/MT. Further Raipur pellet trading at 3-month high and as per assessment the price range is hovering at INR 6,800-7,000/MT as against INR 6,400-6500/MT last week, ex-plant.

— Indian pellet export prices have moved up in recent deal concluded. East India based pellet maker was concluded an export deal of around 50,000 MT for regular grade pellets (Fe 64%, containing 3% alumina) at around USD 126-127/MT, CFR China. In another export deal, BRPL was heard to have concluded pellet export deal to China at around USD 122/MT, CFR China for July.

COAL

Seaborne premium hard coking coal prices have remained unchanged so far this week since the drop last week, amid thin buying interest in China. In China, trade activities has slowed down, with most buyers heard to have been adopting a cautious stance citing current price levels above USD 200/MT CFR China for premium materials.

However, Chinese trading sources anticipate prices of imported premium low-volatile coking coal to stay firm on persistent demand as the country’s steelmakers have become amenable to meet the country’s environmental standards, which require end-users to seek proper-quality coals with high CSR and low ash content. Contrary to the ex-China market, Chinese domestic coking coal prices have gained strength and are expected to increase further next week due to higher demand from coke plants.

Elsewhere in the Indian market, imported coking coal purchases by steel mills are likely to increase in the short term due to on higher steel sales, with federal election results confirming the return of the incumbent ruling government. India’s downstream steel demand and coking coal imports have been subdued over the past few weeks on the back of political uncertainty.

Furthermore, Indian steel mills are expected to restock coking coal ahead of the June-September monsoon season.

— Latest offers for the Premium HCC grade are assessed at around USD 217.85/MT & for the 64 Mid Vol HCC at USD 198.70/MT on CNF India basis.

SCRAP

Indian imported ferrous scrap market witnessed a considerable price hike this week following a sharp rise in the global market. However significant trade activities are yet to pick up. Following positive trend on the Indian election outcome, the market is expecting an improvement in demand amid strengthening of sentiments in coming days.

— SteelMint’s assessment for containerised Shredded from Europe, UK and US stand in the range USD 333-335/MT, CFR Nhava Sheva, rise by around USD 10/MT against last week. Deals were reported towards the closing of the week in this range with buying interest at around USD 330-335/MT, CFR. Few leading suppliers are offering majorly in the range of USD 335-340/MT, CFR.

— Offers for HMS 1&2 from UK and Europe reported in the range USD 310-320/MT, CFR that of Dubai origin remained in the range of USD 325-330/MT, CFR amid limited supply during Ramadan. South African HMS 1&2 offers stand in the range of USD 330-335/MT, CFR and West African origin containerised HMS were reported in the range of USD 310-315/MT, CFR.

— Alang – one of the largest ships breaking yard in the world located in Gujarat- western India, has registered sharp growth in imports of scrapped ships at 124,614 LDT in Apr’19, which is highest since Dec’18. Also the Apr’19 imports grew by 8.9% M-o-M as against 114,387 LDT in Mar’19.

SEMI FINISHED

On weekly basis domestic Semis prices incline in major locations, in which Billet offers rise by INR 100-500/MT and major hike was seen in South India – Hyderabad by INR 500/MT. Inline Sponge iron offers surge by INR 200-700/MT, W-o-W.

In context to Pig iron, the private mills have maintained prices firm despite limited inquiries & awaited fresh offers of Neelachal Ispat which are due since 12th May’19.

— Indian mid sized mills concluded small lots of Billet export deals to Nepal at around USD 445/MT as against last week at close to USD 440/MT; ex-mill, Durgapur.

— Indian sponge iron export offers moved up following surge in domestic prices. Latest offers reported at USD 305-310/MT CPT Bepanole(dry port of India & Bangladesh), equivalent to USD 325/MT CNF Chittagong, Bangladesh. However buying inquiries reported at lessened by USD 5-10/MT.

— Jindal Steel has maintained prices firm and reported steel grade pig iron at INR 28,200/MT ex-Raigarh & panther shots (granulated pig iron) at INR 26,600-26,800/MT ex-Angul, Odisha.

— SAIL’s Rourkela Steel Plant tender held on 22nd May’19 to sell about 6,500 MT steel grade pig iron, had received good response. The base price for the tender was quoted by RSP at INR 27,250/MT and near about 49% (3,100-3,200 MT) material have been sold.

— SteelMint’s Pig iron export price assessment stood at USD 370-375/MT FoB India, USD 320-322/MT FoB Brazil & USD 334-336/MT FoB Black sea.

FINISH LONG STEEL

Indian finish long steel market got a positive outcome considering the price range as it rose by INR 200-700/MT in Rebars. However trade volumes remain depressed due to inappropriate lifting of materials, which is being booked by traders/retailers at the time of strengthening prices.

Industrialists believe that, prices should range bound and might not get wide reduction as production level is already maintained by around 60-65% in major supplying regions i.e. Central or Western regions along with strengthening raw materials.

— As per assessment, the trade reference Rebar prices (12-25 mm) hovering at INR 35,300-35,400/MT ex-Raipur & INR 36,400-36,600/MT ex-Jalna; prices are excluding of 18% GST

— Central region based heavy structure manufacturers offering trade discount of around INR 500-700/MT and current trade reference prices at INR 39,500-39,700/MT (200 Angle) ex-work.

— Trade discounts in Raipur Wire rod slightly increased and currently maintained at INR 1,000-1,200/MT which has been improved against last week i:e; INR 700-900/MT. Meanwhile basic prices for 5.5 mm stood at INR 37,700/MT ex-Raipur & INR 37,000-37,800/MT ex-Durgapur.

FLAT STEEL

This week Indian HRC trade prices continue to fall as demand failed to improve in domestic market. Meanwhile trade sources reported that Indian HRC import offers decline for June end-July shipments resulting to domestic HRC prices under pressure.

Domestic HRC & CRC prices in few markets have come down by INR 500-1,000/MT W-o-W. Currently HRC (2.5-8 mm, IS2062) prices in traders market is around INR 41,000-41,500/MT ex-Mumbai, INR 41,200/MT ex-Delhi & INR 43,500-44,000/MT ex-Chennai. And CRC (0.9 mm,IS 513) in traders market is around INR 45,000-46,000/MT ex-Mumbai, INR 45,500/MT ex-Delhi & INR 50,000/MT ex-Chennai. Prices mentioned above are basic and extra GST@ 18% will be applicable.

Thus inactive buying, liquidity issues, and poor demand kept HRC trades sluggish in domestic market. Also due to cheaper imports arriving from Korea and Japan amid Free trade agreement have pressured sales volumes in Indian domestic market.

Reference Prices as on 25th May 2019 (Week 21)

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

Indian Export Reference Prices as on 25th May’19

Prices in USD/MT
Source: SteelMint Research