India: BigMint's billet index declines by INR 500/t d-o-d amid improved buying - 22 Oct

BigMint's billet index dropped further by INR 500/tonne (t) d-o-d to INR 39,600/t exw-Raipur on 22 October 2024.

The continued decline in the billet index was primarily due to fluctuating market sentiments and persistent weak demand, which exerted downward pressure on both semi-finished and finished steel segments.

However, during the second half of the trading session today, there was a notable increase in buying activity for semi-finished steel. This surge can be attributed to lower offers from neighbouring markets, driven by varying sentiments d-o-d.

Deals of around 5,000 t were recorded today as against 1,800 t on 21 October.

In the finished steel segment, rebar prices decreased by INR 500/t, while wire rod prices declined by INR 600/t d-o-d. Furthermore, sponge iron prices in Raipur plummeted by INR 550/t.

The conversion spread from sponge iron (PDRI) to billets for standalone furnaces in the region was recorded at INR 13,150/t.

Rationale

This index has been derived based on transactions, offers, bids and indicative price data sets. Transactions are considered as T1 and given a weightage of 50%, whereas other data sets are considered as T2 and given a weightage of the balance 50%.

• Transactions (T1) - Four trades at INR 39,500-39,700/t were recorded during the 2:30 pm to 5:30 pm BigMint trading window and considered for final price calculation as T1 inputs. The average of these transactions was INR 39,560/t, which was given a 50% weightage in the final price calculation.
  
  
• Other price indicators - bids/offers/indicative (T2) - Eleven offers were reported in the trading window and considered as T2 inputs. The average price of these eleven was INR 39,595/t and given a 50% weightage in the final price calculation.
  
  

The final price of billets exw-Raipur was at INR 39,577/t, rounded off to INR 39,600/t exw.

Click here for detailed methodology