India: BigMint's ferrous scrap index remains stable for second consecutive day

• Sponge utilisation increases in Mandi
  
  
• Chennai market sees a drop by INR 300/t in semis prices
  
  

BigMint's domestic end-cutting scrap index tracking the Mandi Gobindgarh market remained unchanged at INR 37,700/t DAP on 26 July, 2024. Mills are currently sourcing domestic scrap as imported scrap is not viable. The overall market remains stable with slow trade in steel. Due to the shortage of local scrap and ongoing bid-offer disparities, mills have increased their consumption of sponge iron in their steel making charge mix.

Raw materials overview

Sponge iron (CDRI) prices in Mandi slightly fell by INR 100/t to INR 30,000/t. Similarly, pig iron (steel grade) prices in Ludhiana remained unchanged at INR 40,200/t DAP.

Steel market trend

In the Mandi region, steel ingot prices remained steady at INR 42,700/t today during the price reporting and normalisation phase. Meanwhile, prices in other key markets rose by INR 100/t to INR 400/t. In the Raigarh market, semi-finished prices increased by INR 400/t d-o-d.

Overview of other markets

In the South India-based Chennai market, billet prices decreased by INR 300/t to INR 42,000/t, while rebar prices dropped by INR 200/t to INR 47,300/t. HMS 80:20 prices, however, remained stable at INR 31,800/t. According to market sources, demand for finished steel is very low, although scrap arrivals at mills are moderate. Mills show little interest in imported scrap due to its higher prices compared to domestic scrap, with some mills increasing the use of sponge iron, which is more viable than scrap.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 5,000-5,300/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $385-$392/t, which equates to approximately INR 35,022/t (including freight), while local scrap, HMS (80:20), prices in Mumbai fell by INR 200/t to INR 33,000/t today. In India, indicative prices of shredded scrap from Europe stood at $410-$418/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 13,350/t.

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