India: BigMint's scrap index up INR 200/t amid mixed market trends

• Sponge iron prices remain steady d-o-d
  
  
• Finished steel prices dip INR 200/t
  
  

BigMint's domestic end-cutting scrap index, tracking the Mandi Gobindgarh market, increased by INR 200/tonne (t) d-o-d to INR 36,800/t DAP on 9 December 2024.Today's market showed mixed trends, with semi-finished and scrap prices rising while finished steel prices declined.

A steel makers informed, "The steel market is quiet, with limited demand for finished steel. A slowdown in scrap arrivals has marginally pushed up semis and scrap prices. Mills prefer domestic scrap, while imported scrap buyers face pricing disparities. Ingot prices are anticipated to remain steady in the range of INR 41,700-42,300/t.

Another mill owner informed, "Several medium mills have cut steel production by 20-30% due to high inventory levels and ongoing sales pressure. Weak demand for finished steel and liquidity issues are compounding their difficulties. To reduce expenses, many mills are now operating mainly during night shifts, benefiting from lower electricity rates compared to daytime operations".

Raw materials scenario

Sponge iron (CDRI) prices in Mandi remained stable at INR 30,500/t DAP today. Meanwhile, pig iron (steel-grade) in Ludhiana dipped by INR 300/t to INR 36,700/t DAP.

Steel market overview

Steel ingot prices in Mandi edged up by INR 200/t d-o-d to INR 41,900/t DAP.Semi-finished steel prices exhibited mixed trends today, with some regions witnessing price increases while others saw declines, highlighting diverse market dynamics.

The Mandi market recorded a d-o-d decrease of INR 200/t in rebar (Fe 500) prices, reaching at INR 46,500/t (ex-works).

Overview of Chennai market

In the Chennai market (South India), prices for billets and rebars have remained stable, with billet prices assessed at INR 41,800/t and rebars at INR 46,000/t. Meanwhile, prices for HMS 80:20 have dropped by INR 300/t, now standing at INR 31,500/t.

According to market sources, the demand for finished steel is currently low due to the rainy season, leading to a subdued market. As a result, mill owners to avoid procuring raw materials at elevated rates. Additionally, the liquidity crunch is further impacting the trade dynamics, creating a challenging market environment.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 5,200-5,500/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at $360-365/t, which equates to approximately INR 33,180/t (including freight). Local scrap HMS (80:20) in Mumbai remained stable d-o-d at INR 32,500/t DAP. In India, indicative prices of shredded from Europe stood at $380-$383/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.