Domestic steel demand in Nepal remains subdued. This, in turn, has kept steel prices stable in the country. The ongoing liquidity crunch is somehow reflected in the country’s steel demand, sources based in Kathmandu stated.
Current rebars (12mm) prices in Nepal are reported at around NPR 85,000-86,000/t ($654-661) exw, excluding VAT, stable w-o-w.
The mills continued to operate at lesser capacity utlisation to clear their inventories. Despite this, stock positions remained higher than the average maintained by mills.
- Import deals
Some parcels of IF-route wire rods and billets were concluded this week to Nepal. However, end-users in Nepal are doing need-based procurements, sources close to the trade informed SteelMint.
Fresh offers of IF-route billets from India stand at around $525-530/t, while mid-sized mills’ wire rod offers hovered at $580/t. Both are exw-Durgapur (eastern India). The freight costs to Nepal stand at $20-25/t.
No fresh export deals from BF-route Indian mills were reported because of the export duty that had been imposed. This market was taken over by Indonesia all this while and bulk exports from this country had entered Nepal. However, now that the duty has been removed, Indian mills are expected to resume exports to Nepal.
Offers for BF-route billets are hovering at $555-560/t and for wire rods (SAE 1008) at $610/t LTW-eastern India. The freight costs to Nepal are at $15-18/t.
- Sponge iron demand improves
Sponge iron demand remains active from Nepal as nearly 12,000 t of deals were confirmed this week, including of both lumps and pellet-based DRI.
Current offers for lumps-based DRI (FeM 79-80%, lumps 70%, fines 30%) stood at $395-400/t LTW eastern India, equivalent to $415-420/t CPT Nepal.
Nepal’s sponge iron imports from India are growing with expanding melting capacities in the country.
Nepal imported about 45,500 t of sponge iron in November as against 37,100 t in October 2022. The country’s imports of sponge iron are expected to cross 5 lakh tonnes in CY2022 as against 260,700 t in CY2021.
- Outlook
Domestic steel demand in Nepal may remain moderate or improve slightly in the coming days on account of the favourable construction season in winter and the end of the country’s general elections.
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