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India: BigMint's scrap index improves by INR 300/t d-o-d amid supply concern-12 August'24

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Melting Scrap

BigMint Bureau

142 Reads

12 Aug 2024, 19:16 IST

India: BigMint's scrap index improves by INR 300/t d-o-d amid supply concern-12 August'24

Sponge iron prices remain unchanged d-o-d

Semis, finished steel demand remain moderate

BigMint's domestic end-cutting scrap index for the Mandi Gobindgarh market rose by INR 300/t to INR 36,900/t DAP on 12 August 2024.

Today, the Mandi steel market remained relatively stable in terms of demand, while scrap supply continued to be tight. Suppliers increased their offers in response to the shortage. However, there are notable bid-offer discrepancies between buyers and sellers. Meanwhile, imported scrap buyers have been inactive given the current market conditions.

A mill owner informed BigMint that most leading steel mills in the region are opting for a 70% scrap and 30% sponge iron mix in their steelmaking process. This preference is due to ongoing scrap shortages and bid-offer disparities. Additionally, small and medium-scale mills have increased the proportion of sponge iron in their charge mix to around 60:40.

Raw materials overview

Sponge iron (CDRI) prices remained stable at INR 29,800/t today. Meanwhile, in Ludhiana, pig iron (steel grade) prices moved down by INR 200/t to INR 40,000/t DAP.

Steel market trends

In the Mandi region, steel ingot prices rose by INR 300/t to INR 41,800/t today during the price reporting and normalisation phase. Meanwhile, prices in other key markets increased by INR 100/t to INR 500/t. The Ghaziabad steel market saw the most notable price increase. Prices increased by around INR 500/t. Rebar (Fe500) prices in Mandi remained firm at INR 46,300/t with moderate trade activity.

Overview of other markets

HMS (80:20) scrap prices in Alang, Gujarat, remained steady at INR 33,300/t ex-yard on 12 August 2024, marking the third consecutive day of stability, according to BigMint's assessment. The region's semi-finished and finished steel prices also showed minimal fluctuation in the last trading session. With moderate trade activity in the scrap market, suppliers opted to keep their offers unchanged. Over the past week, HMS (80:20) prices in Alang have declined by INR 1,800/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 Nhava Sheva Port were at around $380-$385/t, which equates to approximately INR 34,525/t (including freight), while local scrap, HMS (80:20), prices in Mumbai remained constant at INR 32,500/t. In India, indicative prices of shredded scrap from Europe stood at $408-$412/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 14,050/t.