India: BigMint's billet index rises by INR 750/t amid higher power tariffs - 3 June'24

• Weak buying in semis, finished steels
  
  
• Higher power tariffs drive up prices
  
  

BigMint's billet index rose by INR 750/tonne (t) to INR 45,350/t exw Raipur on 3 June, 2024.

The index showed a significant increase today, driven by the rise in power charges imposed by the Chhattisgarh State Power Distribution Company Limited (CSPDCL).

This impacted initial costs and resulted in a sudden surge in market offerings. However, demand at higher offers remained limited, as buyers were reluctant to accept spot offers. This led to weak buying activity in both semi-finished and finished steels throughout the day.

Today's transaction were recorded at 1,000 t, against 1,100 t on 31 May. Finished steel rebar prices in Raipur increased by INR 1,000/t and 900 t of volumes were recorded. Wire rod prices rose by INR 700/t and 4,000 t of volumes were noted. Sponge iron prices increased by INR 300/t.

The conversion spread from sponge iron (PDRI) to billets for the standalone furnaces in the region was recorded at INR 16,850/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) - Two trades at INR 45,300-45,400/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 45,340/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Twelve offers reported in the trading window and considered as T2 inputs. The average price of these twelve was INR 45,345/t and given a 50% weightage in the final price calculation.
  
  

The final price for billet exw Raipur was at INR 45,342/t, rounded to INR 45,350/t exw.

Click for detailed methodology

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