India: BigMint's ferrous scrap index dips by INR 100/t-11 Oct

• Raw material prices remain range-bound
  
  
• Finished steel prices slide by INR 100/t today
  
  

BigMint's domestic end-cutting scrap index, tracking the Mandi Gobindgarh market, edged down by INR 100/tonne (t) d-o-d to INR 38,400/t DAP on 11 October 2024. The scrap market has remained weak in recent days, with mills sourcing scrap only as needed and offering lower prices due to slow demand for semi-finished and finished steel, along with noticeable bid disparities. Additionally, the impact of the Reverse Charge Mechanism (RCM) is affecting local suppliers, as small and medium scrap vendors remained uncertain about the new policy.

Raw materials overview

Sponge iron (CDRI) prices in the Mandi market remained stable at INR 33,500/t DAP, with no change from the past three days. This stability has persisted for three days, driven by a decent demand for sponge iron in steel production, while local sponge iron suppliers are not ready to sale material on low prices. In contrast, pig iron (steel-grade) prices in Ludhiana saw a slight increase of INR 50/t to INR 40,300/t DAP.

Steel market overview

In the Mandi region, steel ingot prices remained steady at INR 44,100/t DAP during the price reporting and normalisation phase. Meanwhile, prices in other major markets decreased by INR 50/t to 800/t d-o-d, with the most significant drop of around INR 800/t seen in the semi-finished steel markets of Mumbai. Rebar (Fe 500) prices in Mandi dropped by INR 100/t to INR 48,700/t exw d-o-d. Rebar prices decreased by INR 300/t w-o-w in the region, reflecting slow trading activity.

Overview of the Alang scrap market

Prices of ship-breaking melting scrap in the Alang market of Gujarat decreased by INR 500/t on 11 October. According to BigMint's report, the HMS (80:20) price stands at INR 34,000/t ex-yards. Earlier in the trading session, semi-finished and finished steel prices dropped by approximately INR 300 to 400/t, influenced by weak demand. This decline in scrap trade activity led suppliers to reduce their offers on Friday.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 5,700/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at $375-$380/t, which equates to approximately INR 34,153/t (including freight). Local scrap HMS (80:20) prices in Mumbai fell by INR 300/t d-o-d to INR 33,400/t DAP. In India, indicative prices of shredded scrap from Europe stood at $400-$404/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 13,100/t.

To check BigMint's melting scrap assessment, pricing methodology, and specification documents, click here.