Indian Mill Scale prices noticed some pressure this week amid falling demand from Pellet manufacturers and Blast furnace operators. Prices, which have been trading high due to tight supply of Iron ore fines, have seen a correction of INR 500/MT. It is observed that some of Pellet and Pig iron manufacturers have reduced their production resulting in low demand of Mill Scale.
Current prices in Raipur assessed at INR 3,100/MT (ex-works); down by INR 500/MT since last week. In similar lines, prices at Kandla have fallen by INR 300-400/MT and assessed at INR 2,700-2,900/MT. There are no firm offers for export as Chinese buyers prefer Iron ore over Mill Scale. Last trade of 35,000 MT from Kandla in early November was settled at USD 71/MT FOB.
Indian traders anticipate prices may correct further owing to low demand from domestic consumers and falling Iron ore prices in the global market. Seaborne Iron ore prices hit 5-years low of USD 68/MT CIF China for Fe 62%.
“Chances are high that prices may see some correction. Exports are not viable at these prices and domestic Pellet & Pig iron manufacturers are not willing to stock at these levels,” said a trader based in eastern region of India.
India generates around 1.8-2 MnT Mill Scale, which is equivalent to 2-3% of India’s total finished steel production. Out of the total material, 50% is exported and rest is consumed in the domestic market. Mill Scale market has recently picked up due to tight supply of Iron ore after several mining restrictions imposed by the apex court and government.
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