India: Prices at Maruti CR-busheling scrap auction drop INR 1,000/t m-o-m

India's largest vehicle manufacturer, Maruti Suzuki India Limited (MSIL), recently held an auction for 4,000 tonnes (t) of CR busheling prompt scrap from its Gurgaon facility on 24 February, 2023. The entire quantity was booked at INR 46,350/t ex-works, as prices fell by approximately INR 1,000/t compared to the previous month's auction.

MSIL's auctions are considered a benchmark and the price discovery mechanism for other auto manufacturers' scrap auctions across the country.

These auctions typically comprise clean industrial sheet steel scrap, clippings, stampings, punchings, or skeleton scrap that may include black, galvanised and zinc-coated material. The material is primarily procured by foundries.

Prompt scrap, or prime or new scrap, is a by-product of manufacturing industries, especially automotive. It includes CR punchings, turnings, borings and cuttings as well as prompt scrap metal of all shapes and sizes.

The demand for CR-busheling, trimmings, also known as prompt scrap in India, is on the rise due to low availability in the domestic market. Some primary and large secondary mills prefer prompt scrap over HMS 80:20 and thus continue to bid in auctions conducted by automobile manufacturers.

Last week, some auto component manufacturers in northern and western India conducted multiple auctions for CR-busheling/punching and end-cutting scrap .

Automotive Stampings and Assemblies Ltd. (ASAL) held an auction for HR-CR punching scrap from its Pune-Maharashtra and Panthnagar-Uttarakhand plants on 25 February, 2023. As per sources, 1,200 t was booked from the Pune plant at INR 41,000/t exw, while 1,000 t of material was booked at INR 46,300/t exw from the Panthnagar plant.

Mahindra & Mahindra Limited (M&M)-OEM, conducted multiple auctions last week. Details are given below:

SteelMint's assessment of spot prices of CR busheling scrap

The price level at the Maruti auction remained higher than SteelMint's price assessments of domestic CR busheling scrap. It is expected that prices may go up in the short term in view of the auction result. These auctions play a vital role in setting the benchmark prices for prompt scrap in India, and the recent auctions indicate a growing demand for prompt scrap in the country.