India: BigMint's ferrous scrap index stable d-o-d amid sluggish steel demand - 27 Nov

• Raw material prices witness price drop
  
  
• Rebar dips by INR 200/t d-o-d in Mandi
  
  

BigMint's domestic end-cutting scrap index, tracking the Mandi Gobindgarh market, remained stable d-o-d at INR 36,100/tonne (t) DAP on 27 November 2024.

The Mandi market continued to witness a pause in steel demand, keeping mills under pressure. Buyer activity remained muted, with expectations of further price corrections in the near term.

A mill owner informed: "Buyers expect ingot prices to drop to around INR 41,500/t, Mills, however, expect the market to remain range-bound, and settling at below the INR 42,000/t level."

Raw materials scenario

Sponge iron (CDRI) prices in Mandi fell by INR 200/t to INR 30,800/t (DAP) today. Meanwhile, pig iron (steel-grade) prices in Ludhiana decreased by INR 50/t to INR 37,400/t (DAP).

Steel market overview

Steel ingot prices in Mandi remained unchanged d-o-d at INR 41,700/t DAP during market reporting and normalisation. Semi-finished steel prices across markets declined by INR 100-400/t.

Rebar (Fe 500) prices in Mandi dropped by INR 200/t to INR 46,200/t ex-works, with limited trade inquiries observed.

Overview of other markets

Mumbai's IF-route rebar (Fe 500) prices fell by INR 100/t d-o-d to INR 47,300/t exw. Slow trading activities was seen in the market for finished steel as buyers remained cautious, waiting for further clarity on prices. The current pricing of scrap (HMS 80:20) is INR 32,900/t DAP. The conversion spread between scrap and billets is around INR 8,900/t

In the Jalna market, billet prices declined by INR 200/t to INR 41,300/t, while rebars fell by INR 100/t to INR 46,700/t, and HMS 80:20 scrap prices dropped by INR 500/t to INR 32,600/t.

Market sources indicate sluggish trade activity in finished steel, leading to increasing inventory levels at mills. A mill representative stated, "Rebar bookings are in place, but material lifting remains slow, creating inventory pressure. Additionally, liquidity constraints persist in the market."

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 5,600-5,900/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at $360-365/t, which equates to approximately INR 33,011/t (including freight). Local scrap HMS (80:20) in Mumbai remained stable at INR 32,900/t DAP. In India, indicative prices of shredded from Europe stood at $380-$385/t CFR Nhava Sheva.

Raipur sponge iron-billet spread: The conversion spread (margin) between pellet-based DRI (P-DRI) and steel billets in Raipur stood at INR 14,000/t.

To check BigMint's melting scrap assessment, pricing methodology, and specification documents, click here.