India: Melting Scrap Prices in Domestic Market Remain Supported

Indian melting scrap prices increased during Nov'18 in overall regions amid strengthening global scrap along with sustained substitute commodities.

Participants in major scrap based markets (West & South regions) anticipate that domestic scrap prices are less likely to slump owing to tight supply globally. Also lack of bulk scrap imports in India during Oct'18 on currency (INR) depreciation enough to prevent scrap prices from falling for the moment in India.

Steel mills are preferring local scrap compared to imported scrap owing to which imported scrap trades have lessened. Dubai origin HMS is assessed around USD 340/MT, CFR India.

As per SteelMint assessment, melting scrap prices in major markets in Nov'18 (till 15th) on monthly average basis stood - Alang (Gujarat) INR 27,100-27,200/MT, Chennai (Tamil Nadu) INR 26,800-27,000/MT, Hyderabad (Telangana) INR 27,800-27,900/MT, increases by 1-2% on monthly basis and Jalna (Maharashtra) remained stable i:e; 26,300-26,400/MT.

However finish steel demand observed near to average levels amid limited trade volume through the retailers resulting liquidity crunch in most of the locations which might turned to be average scrap procurement locally.