India: Chennai scrap prices inch up by INR 100/t d-o-d - 19 Sep
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BigMint's latest assessment showed that Chennai's HMS (80:20) scrap prices inched up by INR 100/t d-o-d to INR 31,600/t. Meanwhile, billet and rebar prices remained stable and were assessed at INR 41,300/t and INR 45,800/t, respectively.
Imported and domestic price trends
There was limited availability of European scrap offers into Chennai, with Poland's HMS 1 priced at $370-375/t and turning and boring offered at $345-350/t. Australian HMS 80:20 was available at $365/t, while EU-origin HMS (80:20) was heard at $370-375/t, though buyer interest remained subdued at these levels. CR busheling was seen at $400-405/t, and EU shredded, at $390-395/t, with bids coming in lower at $380-385/t.
Potential rate cuts in the US may enhance liquidity and improve overall market conditions. However, rates are unlikely to undergo significant changes.
Domestically, buyers' bids for HMS 80:20 ranged between INR 31,000-31,500/t for payment terms within seven days. For extended payment periods beyond seven days, prices increased to INR 31,500-32,000/t. On the supply side, offers ranged over INR 31,500-32,500/t. Despite the gap between buyer and supplier expectations, most trades occurred within the range of INR 31,500-32,000/t, reflecting cautious but stable market participation.
Buyer-supplier sentiments
The current price movements have prompted caution from both buyers and suppliers. A scrap seller said: "Buyers are hesitant to commit to higher prices due to the current market uncertainties. However, suppliers are holding firm, citing reduced domestic scrap availability and higher offers for imported scrap as key factors."
The market remains bearish for now, and this trend is expected to continue over the coming weeks. However, domestic infrastructure projects are set to gain momentum, potentially driving a modest rise in both prices and demand by mid-October. Sales of semi-finished and finished steel are performing above average in the region, with no immediate inventory pressure on producers. Major mills are operating at approximately 70-80% capacity, maintaining a steady balance between production and market demand.
Regional comparison
While Chennai's scrap market exhibits steady movement, other regions such as Jalna have experienced milder price increases of INR 100/t to INR 32,500/t in HMS 80:20. In the Raipur market, the same grade remained stable at INR 32,800/t.
Outlook
With the rainy season set to recede, industry experts anticipate moderate activity in the finished steel market. Steel prices are expected to remain stable in the near term, as they have already reached their lowest levels, minimising the likelihood of significant declines in the coming months.
