India: BigMint's ferrous scrap index dips INR 400/t amid general market downtrend

• Slow demand for finished steel to continue in Mandi
  
  
• Prices of semis drop by INR 400/t in Durgapur
  
  

BigMint's domestic end-cutting scrap index tracking the Mandi Gobindgarh market dipped by INR 400/t to INR 38,600/t DAP on 18 July, 2024.

The continuous decrease in finished steel prices is putting pressure on mills, with liquidity issues persisting. Additionally, the reduction in scrap procurement by mills is pressuring scrap suppliers, leading them to potentially lower their offers today.

A mill owner sourced BigMint: "Due to price viability from neighbouring states, Mandi's rerolling mills are considering direct purchases, which puts pressure on local mills in near term. If prices in other markets continue to drop compared to Mandi, this situation could intensify".

Raw materials overview

Sponge iron (CDRI) prices in Mandi remained unchanged at INR 30,500/t with moderate trade activity due to scrap shortage. Additionally, pig iron (steel grade) prices in Ludhiana were marginally fell by INR 100/t to INR 40,300/t DAP.

Steel market

In the Mandi region, steel ingot prices decreased by INR 400/t to INR 43600/t today during the price reporting and normalisation phase. Meanwhile, prices in other key markets moved down by INR 300/t to INR 500/t.

Rebar (Fe500) prices continued to drop, prices fell by INR 300/t to INR 48,400/t with subdued market activity.

Overview of other market

Durgapur: The market has been very slow due to lack of demand for long steel and fluctuating raw material prices. This week, semis prices remained rangebound, as finished steel demand in eastern regions remained inadequate. Steel billet prices fell by INR 400/t to INR 39,300/t, while rebar prices dropped by INR 500/t to INR 41,700/t d-o-d.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 5,000-5,500/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $387-$392/t, which equates to approximately INR 34,979/t (including freight), while local scrap, HMS (80:20), prices in Mumbai increased by INR 300/t to INR 33,300/t today. In India, indicative prices of shredded scrap from Europe stood at $411-$416/t CFR Nhava Sheva.

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 13,600/t.

To see BigMint's melting scrap assessment, pricing methodology and specification documents, Click here

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