India: Chennai scrap prices inch up by INR 200/t w-o-w - 26 Sep

Chennai's HMS (80:20) scrap prices increased by INR 200/t to INR 31,800/t, as per BigMint's latest assessment. Billet prices also saw a jump of INR 300/t, now standing at INR 43,000/t. Rebar prices remained unchanged at INR 47,000/t. Despite these increases, market activity remains moderate, with buyers and suppliers navigating a cautious landscape.

Imported, domestic market trends

Inquiries for imported scrap in Chennai have seen a slight rise, driven by improved sales of semi-finished and finished steel. However, growth remains slow due to tight margins. Turkiye has also experienced a minor increase in demand, further supporting the market. A shortage of scrap has also added to the tightening supply conditions, enhancing the overall market sentiment.

Current offers from Australia are priced between $380-385/t for shredded and $365-370/t for HMS (80:20). Other regions, including Europe, Poland, and South Africa, are offering HMS (80:20) at $375-380/t, HMS (90:10) at $390/t, and shredded at $396-400/t.

Domestically, buyers' bids for HMS (80:20) are ranging between INR 31,500-32,500/t for seven-day payment terms. For extended terms, prices are climbing up to INR 33,000/t. Despite this gap, most trades are being concluded within this range.

Buyer-supplier sentiments

One mill owner said, "The rainy season is approaching, and while steel prices have improved, demand remains moderate. There is sufficient scrap supply, but with the rise in billet prices, suppliers are hoping for higher returns."

A scrap supplier noted, "As billet prices rise, we expect scrap prices to follow. Though some mills have already booked imported scrap, the domestic market will stay strong for the next month until deliveries arrive."

Regional comparison

In the Jalna market in western India, HMS 80:20 grade scrap prices inched up by INR 200/t to INR 33,000/t, and in central India-based Raipur, by a marginal INR 100/t to INR 34,400/t.

Outlook

Chennai's market is showing price increases, but upcoming weather conditions are dampening buyer enthusiasm for finished steel. As the rainy season is approaching, market activity may slow down, but prices are expected to remain steady without major declines.