Weekly round-up: Semi-finished steel prices volatile, flats prices rise

The domestic steel market witnessed a see-saw trend during week 52 ( 19- 24 December 2022). Semi-finished steel prices fluctuated in the range of INR 50-850/tonne (t).

Domestic induction furnace finished long steel offers witnessed an upward price trend while trade reference prices for finished flats increased in the range of INR 100-1,300/t.

Iron ore and pellets

• SteelMint’s bi-weekly domestic pellets (Fe 63%) index, PELLEX, stood at INR 9,250/tonne (t), stable compared to the last assessment on 20 December, 2022.
• The Goa government recently auctioned off four iron ore blocks. As per the latest update, Sociedade De Fomento Industries Pvt Ltd won the Kalay iron ore mineral block in south Goa. The company emerged as the preferred bidder at a premium of 86.4%.
• Vedanta conducted an auction for the sale of 24,000 t of iron ore lumps on 22 December. 20,000 t (Fe55-58%) was booked at INR 3,412-3,442/t and other 4,000 t (Fe58-60%) was booked at INR 3,533-3,653/t. Prices were exclusive of royalty, DMF, and NMET charges.
• India’s pellet export trade improved against last week. SteelMint’s India pellets (Fe 63%, 3% Al) export index, FOB east coast, was recorded at $108/t, up by $3/t w-o-w. A single deal of around 55,000 t of pellets was reported from eastern India-based player this week in the range of $119-120/t, CFR China for January, 2023 shipment.
• SteelMint’s weekly index for India’s low-grade iron ore fines (Fe 57%) exports stood at $65/tonne (t) FOB east coast on 22 December, inching down by $1/t w-o-w. Active buying interest was limited as participants remained on the sidelines due to increasing Covid-19 cases in China.

Coal

• Australian hard coking coal prices rose by $28/t w-o-w to $286/t FOB and $300/t CNF India. This came amid the trade optimism on improvement in trade relations between Australia and China.
• Portside RB3 (4800 kcal/kg NAR) grade coal prices remained unchanged at INR 12,700/t ex-Vizag with limited change in demand dynamics.
• High-CV RB1 (6000 kcal/kg NAR) grade coal prices fell by $10/t to $207/t FOB amid muted demand.

Ferrous scrap

• Indian scrap buyers were largely quiet this week with limited deals recorded throughout the week as steel producers were in a wait-and-watch mode. Meanwhile, limited offers from suppliers were at increased levels due to a material shortage. Imported scrap prices continued to move up as Turkish mills resumed their bookings for after-holiday shipments.
• Furthermore, major mills were waiting for their bulk cargo arrivals by year-end. Buyers were less interested in booking any fresh slots in containers or in bulk.
• SteelMint’s assessment for Europe-origin shredded was recorded at $445-450/t CFR.

Ferro alloys

• Indian silico manganese prices inched up by up to 3% on 24 December. Prices stood at INR 75,800/t ex-Durgapur, INR 75,300/t ex-Vizag and INR 75,300/t ex-Raipur. Prices for silico manganese rose steadily as demand grew in both the domestic and overseas markets.
• Indian ferro manganese prices were largely stable w-o-w at INR 74,700/t ex-Durgapur and INR 74,500/t ex-Raipur.
• Indian ferro chrome prices hovered at around INR 101,200/t exw-Jajpur, up by INR 3,700/t w-o-w on good export demand. A hike in chrome ore prices also led to a rise in ferro chrome prices.
• Indian ferro silicon prices were range-bound w-o-w amid stable supply-demand dynamics. Guwahati producers’ offers were at INR 118,250/t ex-works with few producers selling at slightly lower prices too. Meanwhile, in Bhutan, ferro silicon prices were assessed at INR 123,500/t exw.

Semi-finished

The semi finished steel market observed volatility in prices as demand was moderate at offers floated by mid-sized mills

Domestic sponge iron prices fluctuated between INR 100-550/t while billets offers increased by INR 50-800/t w-o-w.

• Tata Metaliks reduced foundry grade pig iron prices by INR 1,200/t ($15/t) to INR 46,500/t. Prices are exw-Kharagpur and applicable for Kolkata and Howrah markets.
• SAIL conducted an auction for 10,500 t (60 kg and 52 kg, full length) of commercial rails on 17 December from its Bhilai Steel Plant. Out of the total quantity, only 1,450 t was booked, of which 52 kg rails were approved at INR 65,500/t ex-work and 60 kg rails were sold at INR 42,000/t ex-works.
• About 2,500 t of pellets-based DRI (P-DRI) deal was concluded at $365/t LTW from eastern India, equivalent to $385/t CPT Nepal.
• The State Pollution Control Board in Odisha decided to shudown all sponge iron plants (which come under Kuarmunda and Kalunga covering approximately 22 units) from 1 January 2023 to 31 January 2023 on account of the upcoming Men’s Hockey World Cup.

Finished longs

Indian IF-route finished long steel market remained lacklustre in the first half of the week, but regained momentum in the latter half. Buyers were reluctant to make purchases at higher offers but market sentiments changed soon for finished steel as bulk bookings were made post an increase in raw material export deals. An anticipated shortage of sponge iron specifically in the eastern region (Odisha) provided an edge to manufacturers to raise prices of finished steel and prompted buyers to take the position for procurement of material.

• Rebar prices increased by INR 100-1,000/t in various regions, while these remained stable in a few markets in western region (Jalna and Mumbai).
• The trade reference price of Fe 500 grade rebar manufactured via the IF-route for 10-25 mm size was assessed at INR 48,800-49,200/t exw-Raipur and INR 52,700-53,200/t exw-Jalna.
• Trade discount given by Raipur- based heavy structural steel manufacturers was around INR 1,800-2,200/t and trade reference price of 200 mm angles stood at INR 54,300-54,700/t exw-Raipur.
• Trade discounts for wire rods given by resellers in Raipur were around INR 700-800/t and trade reference price was at INR 49,000-49,500/t exw-Raipur and INR 48,800-49,200/t exw-Durgapur for size 5.5 mm.
• Trade prices of rebars made through blast furnace-route remained largely range-bound amid lukewarm buying interest across markets. However, limited supply from mills created availability issues in some of the markets.
• SteelMint’s weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) remained stable w-o-w at INR 56,500/t, exy-Mumbai, excluding GST at 18%.

Finished flats

• Trade reference prices of flat steel products increased a little this week amid an anticipation of price increase for January 2023 sales by major producers. Where HRC and CRC prices showed mixed trends, plates and coated steel prices showed an increase.
• Mills increased coated flat steel list prices by INR 500/t with effect from 20 December.
• On the exports front, HRC offers increased this week on the global trade platform. SteelMint’s HRC (SAE1006) export index rose by $37/t, w-o-w, to $597/t FOB east coast. However, mills were heard to have withdrawn offers and are likely to come up with fresh quotes post the New Year holidays.