Indian Steel Market Weekly Snapshot

During the week-37 (7-14th Sep’19), Indian domestic trade activities were subdued. The mid sized steel mills reported mix response from the domestic buyers over uncertainty in the market.

The prices were on rising mode in the beginning of week, however in later days it marked down trend.

As per SteelMint’s assessment, in these days the prices of Semis products – Billet fluctuated by INR 200-500/MT, while Sponge prices rallied in same proportion.

In line Finished long steel products marked price movement of INR 200-1,000/MT (USD 3-14) through the mid size mills. However the Flat steel prices dropped further by INR 500-1,000/MT (USD 7-14) through the traders end.

IRON ORE and PELLETS

As per sources, few Odisha based major merchant iron ore miners are heard to have increased offers on bulk quantity purchase of fines against the last offer. Odisha’s state-owned miner- Odisha Mining Corporation (OMC) had 51% (196,500 MT) of material got booked in its recent  iron ore fines e-auction scheduled on 12th Sep’19.

— PELLEX increased to INR 6,150/WMT (DAP Raipur) amid active trade volumes. Raipur based plants’ have hiked their offers by INR 200/MT to INR 6,200/MT (ex-plant).  In Durgapur SteelMint’s reference, pellet price increased by INR 400-500/MT to INR 5,600-5,800/MT.

— Two export deals were reported this week. One deal was reported by KIOCL (Karnataka) at around USD 98/MT FoB India (Fe 64% grade, Al 2%) for immediate September loading. Another deal was concluded by an East-India pellet maker to China at USD 107-108/MT, CFR China for Fe 64% grade (Al 3%).

COAL

Australian coking coal prices have been diverging across various grades throughout this week, with premium low-volatile prices continuing to deteriorate, but second tier medium volatile material gaining strength.

Presently, no fresh bookings were confirmed in the Asia-Pacific seaborne metallurgical coal market, while delivered prices to China remained unchanged for both grades of Australian coking coal. Meanwhile, the Indian market has been sluggish for quite some time now, and currently there are ample supplies of premium low-volatile cargoes in the market.

— Latest offers for the Premium HCC grade are assessed at around USD 146.75/MT FOB Australia and USD 153.90/MT CNF India.

FERROUS SCRAP

Imported scrap to India witnessed a slight rise in buying activity, as offers dropped further amid global decline. With increasing inquiries in the market on account of viability in prices, the sentiments seemed to be improving.

— Assessment for containerised Shredded from the UK/Europe and the USA  stands at USD 265-267/MT, CFR Nhava Sheva, down by USD 8-9/MT W-o-W, with few deals being reported even at prices USD 3-4/MT lower than the market, by the end of the week.

— HMS 1 offers from Dubai were reported to around USD 260-265/MT, CFR almost at par with imported shredded, however, trades remained scarce. UK origin HMS 1 is now being assessed at around USD 250/MT CFR. South African origin HMS offers to India were reported at USD 265/MT CFR, with only a few offers on permit issues.

SEMI FINISHED

Indian Semi finished market observed volatility in prices on fluctuating demand. Billet offers fluctuated in the range of INR 200-500/MT & Sponge offers rise by INR 300-500/MT.

— JSW Steel, India’s largest private steel producer has increased its gas based DRI (sponge iron) offers by around INR 750/MT (USD 11) to INR 18,250/MT for Sep’19 deliveries, SteelMint learned from trade participants.

— As per sources, nearly 10,000 MT (equivalent to 4 rakes) sponge iron export deals concluded to Nepal during the mid week, at an average price of USD 245/MT ex-works, loaded to wagon in eastern region for 80 FeM, 100% lumps & bag packed material.

— Meanwhile no major deals reported for Indian sponge iron exports to Bangladesh this week due to hike in prices which are currently evaluated at USD 295-300/MT as against last week at USD 285-290/MT CFR Chittagong, Bangladesh.

— SAIL’s Rourkela Steel Plant tender held on 11th Sep’19 to sell about 1,200 MT steel grade pig iron, had received good response. The base price for the tender was quoted by RSP at INR 23,850/MT and about 100% material sold.

— SAIL has reduced pig iron (steel grade) offers by INR 400/MT (USD 6) from its Bhilai Steel Plant (BSP) and the offer stood at INR 23,400/MT (USD 327) EXW – Bhilai for a quantity of 15,000 MT. It also attracts a quantity discount of INR 100-300/MT.

— The induction grade billet (100*100 mm) export offers through the mid sized mills assessed at around USD 380-385/MT ex-mill, equivalent to USD 405-410/MT CFR Raxaul border.

— Vizag Steel has concluded wire rod export tender to Nepal for one rake at around USD 430-435/MT, this is equivalent to USD 470/MT CPT Raxaul border, Nepal.

— Vizag Steel (RINL) also had concluded the 30,000 MT bloom (IS 2830 grade) export tender at USD 380/MT, FoB and shipment is scheduled on 15 Oct’19. The material offered has specifications – C-0.12-0.23%, Mn – 0.3-1.5%, Si- 0.4% max, P-0.045% max & S-0.045% max.

— The Chhattisgarh High Court has dismissed the petition of Steel Authority of India Limited’s (SAIL’s) Bhilai Steel Plant (BSP) seeking price relaxations for 921 hectares of forest land located in Kanker district. The decision was announced on September 5, 2019.

FINISH LONG

Indian Finish long steel market observed better response in this week as the rebar prices surged by INR 200-800/MT in most of the location of central, east and southern parts of country through the medium scale mills.

However in north and western regions (except Jalna & Goa), the trade volume still need some improvement as the rebar prices down by INR 300-800/MT due to poor lifting by trade participants and festive mood.

As per conversation with market participants, secondary rebar prices likely to remain range bound or might get minor reduction.

— Current trade reference rebar prices (12-25 mm) assessed at INR 31,700-32100/MT ex-Jalna & INR 30,800-31,200/MT ex-Raipur.

— Central region, Raipur based heavy structure manufacturers reduced their base price by INR 1,900/MT to reduce trade discount which stood at near to INR 500/MT as against previous week at INR 1,400-1,800. Current trade reference prices at INR 35,200-35600/MT (200 Angle) ex-work.

— Trade discounts in Raipur wire rod is currently at INR 800-1,000/MT and reference prices stood at INR 31,000-31,200/MT ex-Raipur and INR 31,300-31,800/MT ex-Durgapur, size 5.5 mm.

FINISH FLAT

This week SteelMint heard from its trade sources that domestic HRC prices slumped further by INR 500-1,000/MT in trader’s market post announcement of roll over in flat steel prices by major steelmakers in Sep’19.

As per assessment trade reference prices for HRC (IS2062,2.5-8 mm) is currently at INR 35,500-36,000/MT ex-Mumbai, INR 35,500-36,000/MT ex-Delhi and INR 37,000-38,000/MT ex-Chennai.

Meanwhile domestic CRC prices move down by INR 500/MT this week over limited trades. Thus domestic CRC (0.9 mm, IS 513) trade references prices on weekly basis are hovering at around INR 40,000-41,000/MT ex-Mumbai, INR 40,000-41,200/MT ex-Delhi and INR 41,000-43,000/MT ex-Chennai. Prices mentioned above are basic and extra GST@ 18% will be applicable.

Indian steel mills and traders are eagerly waiting for arrival of festive season as they are hoping that this can help in revival of dull auto demand prevailing in domestic market. Furthermore, Indian steel mills have lowered their HRC export offers to offload their surplus inventories to overseas market. Indian HRC export offers is hovering around USD 440-450/MT FoB basis for Sep end Oct shipments.

Reference Prices as on 14th September 2019 (Week 37)

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

Indian Export Reference Prices as on 14th Sep’19

Prices in USD/MT
Source: SteelMint Research