India: BigMint's ferrous scrap index showed upward trend amid improved steel market
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The domestic steel scrap index (end-cutting) in Mandi Gobindgarh, as reported by BigMint on 23 Feb, 2024, recorded a rise of INR 300/t, settling at INR 37,900/t on a delivered-at-plant (DAP) basis. Today in the Mandi region, there was a notable increase in the arrival of domestic steel scrap, with major mills receiving their bookings. However, the overall steel market trend remained good in Mandi.
Steel ingot prices in Mandi saw an uptick today, climbing by INR 200/t to reach INR 43,200/t during the reporting and normalization phase. Similarly, other prominent markets also observed an increase in steel ingot prices, ranging from INR 100 to INR 500/t. While there was a rise in ingot prices, market activity remained moderate. Additionally, the prices of finished steel, specifically rebar, showed positive movement in Mandi.
In Mandi, the majority of mills have ramped up to 24x7 production schedules due to improved demand observed over the past weeks. This has resulted in a positive outlook for the market, with mills successfully clearing their inventory levels. Likewise, steel markets in other states are also witnessing favorable conditions in finished steel.
Raw material price update
Sponge iron (CDRI) prices in Mandi rose by INR 250 per tonne to INR 31,250 per tonne today, but pig iron (steel grade) prices in Ludhiana stayed the same at INR 39,500 per tonne delivered to the plant.
Overview of other markets
The Jalna steel market witnessed heightened trade activities in finished steel during today's trading session. Prices for semi-finished steel saw a notable increase of INR 300/t, reaching INR 42,500/t, while rebar prices experienced a rise of INR 400/t, settling at INR 48,700/t. Conversely, HMS 80:20 prices remained stable, assessed at INR 32,900/t. According to market sources, there is robust demand for rebar, leading to clearance of inventories in major mills. In response to this demand surge, mills have elevated their selling prices for finished steel.
As of 23 February, 2024, there was no change observed in the ship-breaking melting scrap prices in Alang, Gujarat. According to assessments by BigMint, HMS (80:20) prices remained fixed at INR 33,700/t ex-yard. Despite the surge in semi-finished steel prices witnessed in the previous trading session, suppliers opted to retain stable pricing today, driven by moderate levels of demand for scrap in the local market.
Imported scrap market
In the current Indian market scenario, purchasing activity remains sluggish, particularly with regard to European transactions which have been muted lately. Shredded scrap offers from European sellers at approximately $415-$420/t CFR Nhava Sheva are still deemed unfeasible for buyers. Additionally, downstream purchasers are not exhibiting urgent demand for scrap materials, as they possess ample inventory of raw materials and finished steel. Additionally, steel sales are reportedly low in certain regions.
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: Imported melting scrap prices at Nhava Sheva Port were at around $385-$390/t, which equates to approximately INR 34,535/t (including freight), while local scrap-HMS (80:20) prices in Mumbai up by INR 400/t to INR 33,400/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 13,200/t.
To see BigMint's melting scrap assessment, pricing methodology and specification documents, Click here
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