India: BigMint's ferrous scrap index declines by INR 500/t amid muted semis sales
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- Sponge prices fall by INR 400/t d-o-d
- Ingot prices plunge by INR 300-700/t
BigMint's domestic end-cutting scrap index tracking the Mandi Gobindgarh market fell by INR 500/tonne (t) ($6/t) to INR 38,100/t ($456/t) DAP on 5 July, 2024. Today's trading session was quiet amid muted buying in semi-finished and finished steels. Steel mills focused on need-based scrap procurement, resulting in a d-o-d decline of INR 400-900/t in scrap prices.
Raw materials overview
Sponge iron (CDRI) prices in Mandi decreased by INR 400/t to INR 30,600/t. Moreover, pig iron (steel grade) prices in Ludhiana remained stable at INR 40,900/t DAP.
Steel market trends
In the Mandi region, steel ingot prices dipped by INR 500/t to INR 43,900/t during the price reporting and normalization phase. Meanwhile, prices in other key markets decreased by INR 300/t to INR 700/t. The Rourkela steel market experienced the most significant drop, with prices declining by INR 700/t d-o-d.
Overview of other markets
The Jalna market in Maharashtra experienced a decrease in steel prices, with semi-finished steel dropping by INR 200/t to INR 42,300/t and rebar falling by INR 300/t to INR 47,000/t. HMS 80:20 prices also saw a reduction of INR 400/t to INR 33,400/t. According to market sources, there is very limited demand for finished steel, although scrap arrivals at mills are at a moderate level. Notably, some mill-owners secured good bookings at higher prices earlier today but later reduced the purchase prices.
Price highlights
End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 5,500-5,800/t.
Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $385-$392/t, which equates to approximately INR 34,934/t (including freight), while local scrap, HMS (80:20), prices in Mumbai moved down by INR 300/t to INR 33,700/t today. In India, indicative prices of shredded scrap from Europe stood at $410-$415/t CFR Nhava Sheva.
A mill owner informed BigMint that, "The market is experiencing a significant slowdown, with no buyers showing interest in booking imported scrap since they can acquire domestic HMS (80:20) at INR 33,700-33,800/t levels. This price difference makes the imported material non-viable. Additionally, the higher production levels relative to consumption are pressuring mills to consider reducing their output. Suppliers, on the other hand, are reluctant to lower their prices due to increased freight and shipping costs. Current indicative prices are at $410-$415/t for shredded scrap and $400/t for good quality HMS (80:20), but there are no buyers at these levels".
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 14,150/t.
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