India: Chennai ferrous scrap prices hold steady w-o-w as rains keep steel demand subdued - 14 Nov

• Scrap supply limited at lower offers
  
  
• Billet prices drop INR 300/t w-o-w
  
  

According to BigMint's latest assessment, HMS (80:20) scrap prices in Chennai remained steady w-o-w at INR 32,300/tonne (t), though they inched down by INR 100/t d-o-d. Meanwhile, billet tags dropped by INR 500/t d-o-d to INR 42,500/t, with a w-o-w fall of INR 300/t. Rebar prices slipped by INR 300/t d-o-d to INR 47,000/t. Caution has gripped the market, as trade activity remains moderate. Additionally, steel demand was muted, with frequent rains playing spoilsport.

Imported, domestic market trends

Australian HMS (90:10) was offered at $380-385/t, with shredded priced at $390-396/t CFR Chennai. Indian buyers were selective, targeting lower rates than current open-market offers.

A south Indian steel manufacturer recently booked a 10,000-t bulk shipment of CR busheling scrap from Japan at $390/t CFR Chennai, with a metal recovery of Fe-96-97%. The shipment is expected to arrive in December 2024.

Buyers in the domestic market placed bids for HMS 80:20 at INR 32,000-32,500/t with payment within seven days. For extended payment periods, prices increased slightly to INR 32,500-33,000/t. Offers stayed within the same range, with most trades completed around these price levels.

Buyer-supplier sentiments

A mill representative informed BigMint that finished steel trades have significantly slowed down in recent days, as buyers are hesitant to place bulk orders due to frequent rainfall in Chennai. Scrap supply remains constrained at lower offers, and liquidity issues persist, further impacting the market's overall momentum.

A scrap supplier observed that HMS 80:20 prices held steady w-o-w, hovering at INR 32,000-32,500/t. The restricted supply of scrap has prevented significant price cuts. However, the rainy season is expected to slow down the finished steel market, leading to range-bound pricing and stable demand for scrap in the near future.

Regional comparison

In the Jalna market, billet prices held steady d-o-d at INR 42,100/t, and rebars remained unchanged d-o-d at INR 47,100/t. However, HMS 80:20 scrap prices saw a decline of INR 400/t d-o-d to INR 32,800/t. Trade activity in rebars was slow today, with mills receiving enough domestic scrap supplies, although liquidity concerns continued to affect the market.

Outlook

Market sources suggest that scrap prices are expected to remain mostly stable, with a potential dip of around INR 500/t in the coming days. This is due to the ongoing decline in finished steel prices, which is exerting downward pressure on scrap values.