Weekly round-up: Indian steel market witnesses mixed sentiments

The semi-finished steel market witnessed a supportive trend during week 27 Dec’21 – 1 Jan’22. Domestic billet and sponge iron offers increased by INR 600-2,200/tonne across regions.

India’s induction-route finished long steel mills observed moderate trade enquiries and transactions in the spot market. Rebar prices moved up by INR 500-2,700/t during the week.

Iron ore and raw pellets

• NMDC cut iron ore prices further by INR 300-500/t this week.
• Steel Authority of India Ltd (SAIL) conducted an auction on 30 Dec’21 for 100,000 t of iron ore dump fines (Fe 60.5%-indicative) from its Bolani iron ore mines in Odisha. Out of the total quantity, the steelmaker received bids for 60,000 t offered at INR 2,950/t ex-mines, including royalty, DMF, NMET and additional premium.
• SteelMint’s weekly index for low-grade iron ore fines (Fe 57%) exports decreased by $1/t to $34/t FOB east coast India. India’s iron ore export market continued to remain inactive.
• SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 10,700/t DAP Raipur on 31 Dec’21, up slightly by INR 50/t against the last assessment on 28 Dec’21.
• SteelMint’s India pellet export index (Fe 64%, 3% Al, FOB east coast) came down by around $3/t on a w-o-w basis to $134/t. The market was relatively very silent this week with not many offers/bids seen owing to the approaching holidays. However, with the drop in global iron ore fines index, price indications for pellet exports have fallen.

Ferous scrap

Imported scrap prices into India showed a recovery recently after witnessing a fall in the past one month. The recovery was on account of the rise in semi-finished and finished steel prices in India. That apart, there has been resumption in active trade in neighbouring Pakistan. Market sentiments in India also turned supportive.

• Offers for the UK/EU-origin shredded in containers stood at $535-540/t CFR Nhava Sheva, up by further by $5/t w-o-w. However, no firm bookings were reported.
• A western India-based steel mill bought 1,000 t UAE-origin HMS 1&2 (80-20) at $445-450/t CFR Kandla basis earlier in the week.
• However, towards the weekend, offers for Dubai-origin HMS (80:20) and HMS 1 stood at $470/t and $475/t CFR Nhava Sheva respectively, up $10/t w-o-w.

Ferro alloys

The overall Indian ferro alloys market received a diverse response with manganese alloys prices, inching up owing to improved domestic demand. Ferro silicon prices remained stable while ferro chrome prices fell.

• Indian silico manganese (60-14) prices went up by around INR 4,000-5,000/t w-o-w to INR 97,000-98,000/t on exw basis in Durgapur and Raipur. The hike in prices is mainly because of improved demand from both the export and domestic markets.
• Indian ferro manganese (HC 70%) prices inched up owing to limited supply. According to SteelMint’s assessment on 31 Dec’21, the current market price of ferro manganese is hovering at around INR 98,500-101,250/t on exw basis in Durgapur and Raipur.
• Indian ferro chrome (HC60%) prices dropped by INR 11,200/t w-o-w to INR 99,200/t exw-Jajpur as China’s major steel producer reduced their offer prices.
• Indian ferro silicon (70%) prices remained stable this week as most of the producers were booked for Jan’22. Buyers are now waiting for the new price opening from Bhutan’s producers. Thus, limited supply and moderate demand kept prices unchanged w-o-w at INR 170,000/t exw- Guwahati, assessed by SteelMint on 30 Dec’21.

Semi finished

Domestic billet offers rose in the range of INR 600-2,200/tonne across regions with a major rise of INR 1,500-2,200/t reported in the Jalna, Goa and Hyderabad markets. The sponge iron market observed a rise in prices by INR 700-1,400/t on fluctuating demand.

• A major Jharsuguda, Odisha-based mill reported 3,000 t of steel grade pig iron deals at around INR 38,700/t exw.
• SAIL held an auction for 4,800 t of basic grade pig iron (in 48 units) on 30 Dec’21 from Rourkela Steel Plant (RSP) in Odisha. The entire quantity was booked at a weighted average price of INR 38,356/t exw.
• Vizag Steel Plant floated a spot sale export tender for 30,000 t of steel blooms (150x150mm, 3SP/4SP grade) with the due date being 4 Jan’22. The shipment is scheduled for mid-Feb’22.
• SAIL conducted an auction on 30 Dec’21 for 4,000 t (two rakes) of steel grade pig iron from Bokaro Steel Plant (BSL) in Jharkhand. The entire quantity was booked at a weighted average price of INR 38,200/t exw.
• Vizag Steel issued a sale tender for export of 2,710 t billets, blooms and wire rod coils to Nepal, as per SteelMint reports. The due date of submission of bids is 1 Jan’22.
• A steel mill booked around 15,000 t of BF billets for exports to Nepal at around $600/t, while the revised offers reported at around $620/t, CPT Raxaul border.
• Induction furnace grade billet export offers were reported at around $585/t exw-Durgapur, equivalent to $610/t CPT Nepal. These offers increased by $20-25/t, w-o-w.
• Around 3,000 t of sponge iron (lumps 100%, FeM 80%) export deals were reported to Bangladesh at around $430-435/t CPT Benapole, equivalent to $460-465/t CFR Chittagong.

Finished longs

India’s induction-route finished long steel market, in this week, observed moderate trade enquiries and transactions. On a weekly basis, prices in rebar steel in most of the markets increased by INR 500-1,800/t, w-o-w, and a sharp hike of INR 2,700/t was observed in the Delhi/NCR market. Positive sentiments in the market and rise in raw material prices strengthened finish long steel prices, SteelMint learned.

• The trade reference price of Fe 500 grade rebar steel manufactured via IF-route for 10-25 mm size was assessed at INR 46,200-46,600/t exw-Raipur and INR 49,600-50,000/t exw-Jalna.
• Trade discounts given by Raipur-based heavy structural steel manufacturers were in the range of INR 1,800-2,000/t. Trade reference prices of 200 mm angle stood at INR 52,000-52,400/t exw Raipur.
• Trade discounts given by Raipur-based wire rod suppliers are hovering at INR 1,800-2,000/t. Trade reference prices stood at INR 45,900-46,100/t exw-Raipur and INR 47,400-47,600/t exw-Durgapur, size 5.5 mm.

Finished flats

• The adherence to need-based procurement continued to weigh on the trade reference prices of finished flat steel products this week. The trade segment participants were expecting mills to reduce their list prices by INR 1,500-2,000/t for Jan’22 deliveries.
• Furthermore, sluggish demand in the overseas markets dragged down SteelMint’s India HRC (SAE 1006) export index by $25/t w-o-w to $725/t FOB east coast. However, a private manufacturer had booked 4 rakes of HRCs to Nepal at $765-770/t CFR Raxaul border.
• Meanwhile, low demand from the other overseas markets led to rising inventories with mills which may further weigh on trade market prices and sentiments.