India: BigMint's scrap index falls by INR 200/t amid muted steel demand - 9 Sep'24
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- Sponge iron prices remain constant d-o-d
- Semis, finished steel fall by INR 100/t today
BigMint's domestic end-cutting scrap index, which tracks the Mandi Gobindgarh market, dipped by INR 200/tonne (t) to INR 36,800/t DAP on 9 September 2024.
A mill owner reported that a significant slowdown in demand was witnessed in today's trading session in the Mandi steel market. Both morning and afternoon sessions saw limited buyer activity, which led to a drop in prices across various steel segments. The sluggish demand reflects caution among buyers, further contributing to the ongoing price decline.
Major news
In a recent development, the GST Council has decided to keep the GST on domestic scrap at 18%. Market participants had been closely monitoring the outcome, hoping for a reduction, but the final decision did not favour steel scrap consumers.
Raw materials overview
Sponge iron (CDRI) prices remained stable at INR 29,800/t DAP Mandi. Meanwhile, in Ludhiana, pig iron (steel grade) prices dropped by INR 500/t to INR 38,500/t DAP.
Last three months' trend
Steel market trends
In the Mandi region, steel ingot prices decreased by INR 100/t to INR 41,600/t during BigMint's price reporting and normalisation window. Meanwhile, prices in other key markets saw a marginal dip of INR 100-200/t. Rebar (Fe 500) prices fell by INR 100/t to INR 46,200/t exw, with limited trades observed.
A continuous decline has been noticed over the past three months.
Overview of other markets
Mumbai: Prices of induction furnace (IF) route rebars (Fe 500) remained stable d-o-d in Mumbai at INR 45,700/t exw. Slow trading activity was seen in the market for finished steel. Current prices of scrap (HMS 80:20) stood at INR 32,700/t DAP. The conversion spread between scrap and billets is at around INR 7,700/t.
Price highlights
End-cutting-billets spread: In Mandi, the end-cutting scrap and billet spread was at INR 4,800-5,000/t.
Domestic vs imported scrap: Imported melting scrap prices at the Nhava Sheva Port were at $365-$370/t, which equates to approximately INR 33,264/t (including freight). Meanwhile, local scrap HMS (80:20) prices in Mumbai remained stable at INR 32,700/t DAP. In India, indicative prices of shredded scrap from Europe stood at around $390-$395/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 13,050/t.
To see BigMint's melting scrap assessment, pricing methodology, and specification documents, click here.
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