India: BigMint's ferrous scrap index fell by INR 400/t on 10 May'24

• Slow market continues to impact steel prices
  
  
• Pressure mounts on scrap suppliers in Mandi
  
  

BigMint's domestic end-cutting scrap index in the Mandi Gobindgarh market has fallen for the fifth consecutive day, dropping by INR 400/t to INR 41,500/t DAP on 10 May, 2024. With mills facing pressure from subdued demand in the semi-finished and finished steel markets, scrap procurement has slowed down considerably. So, mills have adjusted their offer prices downward and are taking control of negotiations. Scrap suppliers have been enduring this situation for the past few days.

Raw materials

Sponge iron (CDRI) prices in Mandi decreased by INR 200/t to INR 35,500/t, while steel-grade pig iron prices in Ludhiana decreased by INR 200/t to INR 43,800/t d-o-d as trades and offer are on the slower side.

Semis, finished steel

Steel ingot prices in Mandi Gobindgarh fell by INR 400/t to INR 47,300/t during the price reporting and normalisation phase. Prices of semis in other major markets witnessed a decline, ranging from INR 300-600/t. The most significant drop of INR 600/t was observed in the Jaipur market.

In Mandi, rebar (Fe500) prices fell by INR 100/t to INR 52,600/t today.

"The primary reason for the price decline in semi-finished and finished steel was the restricted number of buyers in the market. However, mills remain optimistic about a potential upturn in the coming week, leading them to acquire scrap at a moderate level in the region" a mill owner told BigMint.

Overview of other markets

Gujarat's Alang market witnessed a drop of INR 100/t in ship-breaking melting scrap prices on 10 May, as per BigMint's assessment. HMS (80:20) prices were evaluated at INR 39,200/t ex-yard. Meanwhile, semi-finished steel prices dipped roughly INR 200/t during yesterday's trading session in the region. Suppliers responded to moderate trade activities in scrap by reducing their offers today.

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 market: Imported melting scrap prices at Nhava Sheva Port were at around $405-$410/t, which equates to approximately INR 36,444/t (including freight). Local scrap-HMS (80:20) prices in Mumbai remained unchanged at INR 36,500/t DAP. In India, indicative prices of shredded scrap from Europe stood at $425-$430/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 15,000/t.

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

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