India: BigMint's ferrous scrap index falls by INR 1,000/t w-o-w
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Domestic end-cutting scrap prices in the Mandi Gobindgarh steel market saw a slight increase on 16 March. Prices on the BigMint scrap index rose by INR 100/tonne (t) to INR 36,900/t DAP amid moderate trade activity today. However, price disparities between scrap buyers and sellers persisted in Mandi and prices were down by INR 800-1,500/t on a weekly basis. Furthermore, steel ingot prices in the region also saw a modest uptick, climbing by INR 100/t to INR 42,400/t during the reporting period. Conversely, prices in other major markets recorded declines ranging from INR 100/t to INR 300/t on the same day.
Weekly scenario of Mandi
Throughout the current week, the Mandi steel market experienced restrained trade activity, primarily due to limited demand for semi-finished and finished steel, disrupting the trade flow. Steelmakers resorted to procuring scrap in volumes based on immediate need, with limited price margins, as scrap availability remained ample and price disparities persisted in the region. However, liquidity issues were also noted as a contributing factor.
Raw material price update
In Mandi, sponge iron (CDRI) prices rose by INR 100/t to INR 30,900/t, while pig iron (steel grade) prices in Ludhiana held steady at INR 39,000/t on a DAP basis.
Weekly price change
In Mandi Gobindgarh, steel ingot prices dropped by INR 900/t, while end-cutting scrap prices witnessed a decline of INR 1,000/t. Additionally, rebar (Fe500) prices decreased by INR 800/t, and sponge iron (CDRI) prices saw a drop of INR 200/t on a weekly basis.
Imported scrap market weekly trend
In India, the demand for imported scrap remained lacklustre as buyers continued to primarily procure from the domestic market due to its cost-effectiveness. Shredded scrap offers dropped by $3/t to $403/t CFR on a weekly average basis, while HMS (80:20) stood at $377/t CFR, down by $5/t compared to $382/t CFR.
A representative from a steel mill commented, "We are currently not interested in imports. Turkiye has halted its purchases, waiting to see if prices drop by more than $10/t. Indian buyers are expected to resume bookings, but with elections approaching, market activities are expected to remain sluggish."
Overview of other markets
As of 16 March, 2024, ship-breaking melting scrap prices stayed unchanged in Alang, Gujarat. BigMint's assessment reported HMS (80:20) prices at INR 33,500/t ex-yard. The demand for semi-finished and finished steel was moderate during the previous day's trading session in the region. This, combined with a moderate trade activity for scrap, led scrap suppliers to keep their offers stable today. Over the week, Alang HMS (80:20) scrap prices dropped by INR 500/t.
Mumbai's IF-route rebar (Fe 500) prices decreased by INR 100/t d-o-d to INR 49,400/t exw. Market witnessed low-key trading activities in finished steel as buyers are in wait-and-watch mode amid weak market sentiments. Scrap (HMS 80:20) prices stand at INR 33,500/t DAP. The conversion spread from scrap to billet hovered at INR 9,100/t.
Price highlights
End-cutting and billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 5,000-5,500/t.
Domestic vs imported scrap: The imported melting scrap prices at Nhava Sheva Port stood at approximately $370/t-$376/t, equivalent to around INR 33,366/t (including freight charges). Meanwhile, local scrap prices for HMS (80:20) in Mumbai remained constant, settling at INR 33,500/t d-o-d.
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 13,250/t.
To see BigMint's melting scrap assessment, pricing methodology and specification documents, Click here
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