India: BigMint's scrap index dips INR 700/t d-o-d on weak steel market sentiments

• Semis' prices fall by INR 1,700/t w-o-w
  
  
• Raw material prices witness continued decline
  
  

BigMint's domestic end-cutting scrap index tracking the Mandi Gobindgarh market decreased by INR 700/t to INR 37,700/t DAP on 22 July, 2024. Today, scrap prices fell by INR 600-700/t, marking a decrease of INR 1,300/t to INR 1,500/t w-o-w.

The Mandi steel market is experiencing a continued decline due to dull steel demand, leading to price drops in semi-finished, finished, and scrap markets. Mills are dealing with raw material price disparities between buyers and sellers, along with very slow trade activity in the finished steel market. Additionally, liquidity pressure remains a persistent issue in the market.

A mill owner sourced BigMint, "Some mills anticipate that the current price drop will be the bottom, as semi-finished steel prices have already fallen unexpectedly. They expect prices to stabilse in the near term, leading to a pause in further declines; otherwise, mills may halt production at these price levels".

Raw materials overview

Sponge iron (CDRI) prices in Mandi declined by INR 200/t to INR 30,000/t. Similarly, pig iron (steel grade) prices in Ludhiana dropped INR 200/t to INR 40,000/t DAP.

Steel market

In the Mandi region, steel ingot prices decreased by INR 700/t to INR 42,600/t today during the price reporting and normalisation phase. Meanwhile, prices in other key markets moved down by INR 200/t to INR 700/t. Semis' prices witnessed a heathy drop of INR 1,700/t w-o-w.

Rebar (Fe500) prices dropped by INR 400/t to INR 47,600/t due to limited trade activity.

Overview of other markets

Prices for ship-breaking melting scrap in Alang, Gujarat, remained stable on 22 July, according to BigMint's assessment, with HMS (80:20) priced at INR 35,200/t ex-yard. Semi-finished and finished steel prices also stayed firm in the previous trading session, and moderate trade activity led suppliers to keep their scrap offers unchanged today.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread was at INR 4,900-5,300/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $385-$390/t, which equates to approximately INR 34,829/t (including freight), while local scrap, HMS (80:20), prices in Mumbai increased by INR 200/t to INR 33,500/t today. In India, indicative prices of shredded scrap from Europe stood at $410-$415/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 13,250/t.

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

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