India: BigMint's scrap index drops INR 1,700/t w-o-w on muted demand-23 Oct

• Raw material prices fall by INR 200/t-500/t d-o-d
  
  
• Weak demand in semis, finished steel markets
  
  

BigMint's domestic end-cutting scrap index, tracking the Mandi Gobindgarh market, deceased by INR 400/tonne (t) d-o-d to INR 36,600/t DAP on 23 October 2024. On a weekly basis, scrap prices dipped INR 1,700 to INR 2,200/t, reflecting muted buying activity observed in the Mandi steel market.

Sluggish demand for finished steel is putting pressure on mills, which is being compounded by liquidity concerns linked to sales. Overall, inventory levels for finished steel remain healthy, and scrap inventory is also satisfactory. However, stringent monitoring at borders is affecting trade flow. Additionally, the lack of infrastructure demand poses a significant challenge in the current market landscape.

Raw materials scenario

Today, prices of sponge iron (CDRI) in the Mandi market slipped by INR 200/t to INR 32,800/t DAP. In contrast, pig iron (steel-grade) in Ludhiana dropped by INR 500/t to INR 39,000/t DAP.

Steel market overview

Steel ingot prices in Mandi declined INR 350/t d-o-d to INR 42,700/t DAP during the price reporting and normalisation phase. Prices of semi-finished steel across multiple key markets dropped by INR 200/t d-o-d to INR 500/t, while the Muzaffarnagar semi-finished market witnessed a marked decrease of INR 500/t today.

Rebar (Fe 500) prices in the Mandi market dipped INR 400/t to INR 47,900/t exw today, as modest trade was observed in the region.

Overview of other markets

The Jalna market saw a decline in billet and rebar prices, which fell by INR 500/t to INR 41,800/t and INR 47,600/t, respectively. HMS 80:20 scrap remained steady at INR 32,600/t. According to market sources, rebar trade activity was slow today, with mills receiving enough domestic scrap to cover their needs. However, some liquidity challenges are affecting market sentiment.

Durgapur: Limited trades were observed in West Bengal this week amid volatile price trends. However, need-based buying was evident in the market. Currently, market participants await clarity on trends and remain cautious about making bulk bookings. Billet prices moved down by INR 300/t d-o-d to INR 39,300/t DAP, while rebar prices dipped INR 300/t to INR 42,800/t exw.

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Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 6,000-6,100/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at $375-$380/t, which equates to approximately INR 34,149/t (including freight). Local scrap HMS (80:20) in Mumbai marginally fell by INR 100/t d-o-d to INR 32,700/t DAP. In India, indicative prices of shredded from Europe stood at $395-$398/t CFR Nhava Sheva.

Raipur sponge iron-billet spread: The conversion spread (margin) between pellet-based DRI (P-DRI) and steel billets in Raipur stood at INR 13,100/t.

To check BigMint's melting scrap assessment, pricing methodology, and specification documents, click here.