India: BigMint's billet index declines further by INR 350/t amid limited buying - 5 July

BigMint's billet index dropped further by INR 350/t, reaching INR 39,850/t exw-Raipur on 5 July, 2024.

The index showed a further decline today, primarily due to weak buying in both semi-finished and finished steel. Although a few bookings at lower offerings were recorded on d-o-d basis, overall sentiments remained slow.

This reduction in demand has resulted in downward adjustments in spot market offers. Market participants are maintaining a cautious outlook, anticipating further corrections in the near term due to unsupportive market response in finished steel.

Today, around 1,500 t deals were recorded, maintaining the same volume as on 4 July.

In Raipur, rebar prices decreased by INR 400/t, with 1,200 t of trades recorded. The price of wire rod fell sharply by INR 900/t d-o-d. Additionally, the price of sponge iron in Raipur decreased by INR 350/t today.

The conversion spread from sponge iron (PDRI) to billets for the standalone furnaces in the region was recorded at INR 14,150/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 39,800-40,100/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 39,861/t which is given a 50% weightage in the final price calculation.
  
  
• Other price indicators - bids/offers/indicative (T2) - Nine offers were reported in the trading window and considered as T2 inputs. The average price of these nine was INR 39,800/t and given a 50% weightage in the final price calculation.
  
  

The final price of billet exw Raipur was at INR 39,830/t, rounded to INR 39,850/t exw.

Click for detailed methodology

T1 - Trade, T2 - Offer/Bid/Indicative, *Normalized price as per methodology