Weekly round-up: Semi-finished steel prices decline; flats remain volatile

The domestic IF steel market kept trending lower during week 48 ( 21-26 November, 2022). Semi-finished steel prices plunged in the range of INR 700-3,500/tonne (t).

Domestic IF finished long steel offers witnessed a downward price trend. Offers declined up to INR 3,800/t w-o-w. Trade reference prices for finished flats fluctuated in the range of INR 100-700/t.

Iron ore and pellets

• SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 8,750/tonne (t), stable compared to the last assessment on 22 November, 2022. However, no pellet deals were reported in this current publishing window.
• KIOCL has recently informed that the company’s pellets plant operations in Mangalore resumed from 24 Nov’22 amid feasible international market, as a result of the removal of pellets export duty by the Government of India. The government has recently announced the relaxation in pellets export duty. It may be noted here that KIOCL’s pellets plant has a capacity of 3.5 mnt/year.
• India’s pellet export trade activities have improved following the export duty withdrawal by the Indian government last week. SteelMint’s India pellet (Fe 63%, 3% Al) export index, FOB east coast, stood at $101/t on 23 Nov’22. Trade activities have picked up post removal of 45% export duty announced last week by the Indian govt.
• NMDC conducted an auction for 353,000 t of iron ore from its Kumaraswamy mines in Karnataka on 23 Nov’22. According to sources, the entire material was booked. 85,000 t of lumps (10-40mm, Fe60.01-65.24%) were booked at INR 2,940/t and 268,000 t of fines (Fe58.19-64.21%) were booked at base price of INR 1,668-2,075/t. All prices exclude royalty, DMF, and NMET charges.

Coal

• Australian hard coking coal prices fell by $27/t w-o-w to $247/t FOB and $262/t CNF India. The prices continued their fall due to muted demand from steel mills globally.
• Portside RB3 (4800 kcal/kg NAR) grade coal prices remained largely unchanged at INR 13,000/t ex-Vizag amid small parcel bookings by sponge iron manufacturers.
• High-CV RB1 (6000 kcal/kg NAR) grade coal prices remained stable at $196/t FOB amid quiet international market.

Ferrous Scrap

• Indian scrap buyers are waiting for a better price as prices are going upward following the Turkish deals throughout this week. Meanwhile fewer deals were concluded at lower prices than usual, and the recently uplifted export duty has no impact currently in Indian ferrous scrap market.
• Buyers anticipate, prices likely to remained high for the time being as Turkish buyers are restocking before winter holidays. Additionally, as prices moving up neighboring countries like Pakistan has also resume trade activities.
• SteelMint’s assessment of Europe-origin shredded scrap offers into India were at $415/t CFR Nhava Sheva, down $3/t w-o-w.

Ferro Alloys

• In SteelMint’s assessment on 25 November, Indian silico manganese prices were down by 1% w-o-w to INR 72,600/t ex-Durgapur, INR 72,000/t ex-Vizag, and INR 72,600/t ex-Raipur. Amid the downtrend in the domestic steel market during the period.
• As on 25 November, Indian ferro manganese prices were almost stable w-o-w to INR 75,000/t ex-Durgapur and ex-Raipur at INR 75,000/t. Ferromanganese prices were stable due to muted demand continuing in special steel.
• According to SteelMint’s assessment on 24 November, smelters were offering around INR 98,300-99,500/t exw Jajpur, a marginal drop of around INR 1300/t w-o-w as ferro chrome prices fell marginally w-o-w due to sluggish demand and hard bargaining by buyers and weak Chinese demand also continued to weigh on ferro chrome prices.
• Indian ferro silicon prices remained stable w-o-w amidst moderate supply-demand conditions. On 24 November 2022, Guwahati-based producers were offering ferro silicon Si-70% grade at INR 122,300/tonnes(t)-exw, nearly stable from the previous week prices, according to SteelMint’s assessment. Bhutan’s offers remained nearly constant at INR 125,000/t exw.

Semi finished

Indian Semi finished steel prices decrease sharply as per SteelMint assessment, the domestic billet prices fell by INR 1,350-3,500/t across region with a major fall seen in Jalna & Goa.

Low demand and falling billet prices weighed on sponge iron offers, as prices declined by INR 750-2,700/t. The prices fell due to low buying interest nearly to levels seen before export duty removal.

• SAIL held an auction for pooled iron scrap on 21 Nov’22 from its Bhilai-Chhattisgarh unit. As per sources, 2,500 t of scrap (pooled iron) sold at 36,000-36,100 t exw.
• Vizag Steel has floated two ocean sale export tenders for 5,000 t of wire rods coils (5.5-16mm, SAE-1008/1010/1012/1012S/1018) and 20,000 t of steel billets (90x90mm, C20MMn Gr. A). The due date for both the tenders is 28 Nov.
• SAIL has floated an ocean sale export tender from its Durgapur Steel Plant for 18,900 t of prime mild steel non-alloy concast billets (125x125x9000/12000 mm, 4SP/5SP). The shipping is scheduled by 15 Jan’23.
• Sponge iron export price assessment up by $5/t, w-o-w, to $405/t CPT Nepal, (FeM 80%, lumps 70%, fines 30%). About 4,000 t of deals were concluded this week.
• Nepal’s resume purchases from India after a long spam. A few parcels of IF-route billets conclude this week and current offers hovering at $515-520/t exw Durgapur. While, wire rod offers hover at $555-560/t exw-Durgapur (eastern India) basis. The freight costs to Nepal stand at $20-25/t.
• BF-route billets offer are floated at $545-550/t and offers for wire rods (SAE 1008) stand at $610-620/t LTW-eastern India. The freight costs to Nepal are at $15-18/t.

Finished Long

India’s finished long steel market of induction furnace route observed a subdued trades and transactions in earlier phase of week in most of the markets. Buyers were not showing interest to procure material on higher prices, as after removal of export duty in last week, prices were sharply increased in every commodity which created panic in the spot market and then somewhat slower and downtrend in raw material prices this uncertainty lessened attract the buyer to give any bulk orders. Manufacturers reduce their offers and giving tradeable discounts as per tracking steel billet prices and booking orders. Still, healthy momentum and trades yet to pick up in market, SteelMint learned.

• On a weekly basis, In rebar steel prices sharply plunged by INR 500-3,800/t across the regions, as SteelMint assessment shows.
• The trade reference price of Fe 500 grade rebar manufactured via the IF route for 10-25 mm size was assessed at INR 45,200-45,600/t exw Raipur, INR 51,800-52,300/t exw Jalna.
• Trade discount given by Raipur- based heavy structural steel manufacturers is stood at around INR 1,700-2,000/t and trade reference price of 200 mm angles stood at INR 52,500-52,800/t exw Raipur.
• Trade discounts in Raipur wire rod given by resellers is around INR 1,000/t and trade reference price at INR 45,300-45,700/t exw Raipur and INR 45,400-45,800/t exw Durgapur, size 5.5 mm.
• This week BF route rebar prices showed mixed trends with weak buying interest continuing to weigh on prices. Market sentiments improved slightly after removal of export duty by Indian government from 19 November, however failed to translate into a decent increase in trade level prices. Meanwhile, sharp fall in IF-route rebar prices kept demand slow over the week as buyers turned cautious.
• Current week’s assessment rebar (12-32 mm, BF-route, IS 1786, Fe500D) remained stable w-o-w at INR 55,000-56,000/t exy-Mumbai, excluding GST @ 18%.

Finished Flat

• Trade level prices of finished flat steel products in most of the markets under assessment relayed mixed trend. Government’s announcement on 18 November entailing removal of the 15% export duty from 19 November onwards had little-to-no effect on the market price level.
• Sellers in Kolkata and Ludhiana had raised their offer prices for HRC on 19 November to test the market acceptance. However, the market didn’t accept it in full, pulling them down again but remained a little higher against the previous week’s assessment. Whereas the price increases in Faridabad and Mumbai were rolled back by the beginning of the current week keeping them stable w-o-w. Plates and coated steel prices were also seen sticking closer to previous week levels.
• Buyers continue to show limited buying interest and adhere to quenching their urgent requirements rather than stocking up. Apart this, the inbound low priced imported HRCs are also among the factors weighing down on the replenishment of stock levels among buyers and distributors alike, informed reliable sources.
• On the exports front, Indian mills continue to stick to sidelines for the second consecutive week. SteelMint’s India HRC (SAE1006) export index stood unchanged at $518/t amid no firm offers for the past couple of weeks. Overseas buyers too refrained from bidding amid concerns around the global recession and elevated power costs especially in EU. Whereas, Vietnamese mills were heard scouting for export opportunities on the global trade platform amid lackluster in-home demand.
• Market participants await mills to announce their list prices for domestic sales in early few days of December along with fresh export offers to the overseas markets. Offers/ prices are likely to remain under pressure in the near term with the supplies increasing in the exports market and persistent slow demand in both overseas and domestic market, opined a few distributor sources.