India: Stainless steel demand remains dull, finished steel prices fall

The market for finished stainless steel in India has been experiencing a continuous downtrend in demand. However, the scrap market has remained stable. Prices for 304-grade hot-rolled coils (HRCs) dropped slightly to INR 204,000/t ($2,485/t) exw, while 304-grade scrap prices stood at INR 130,000/t ($1,584/t) ex-Delhi.

Three-month nickel futures on the London Metal Exchange (LME) were mostly stable w-o-w. Three-month nickel futures were hovering at around $24,035/t. Moreover, molybdenum prices decreased w-o-w. Notably, nickel and ferro molybdenum are the key raw materials used in stainless steel production.

Market highlights

Due to a decline in demand for both imported and domestic material, market participants have become cautious and are adopting a wait-and-watch approach. It is worth noting that May is typically a good month for trading. However, because prices have continued to fall, sellers are hesitating to offer at lower prices. Meanwhile, buyers anticipate a further drop in prices.

Sources reported that prices of imported scrap for 304-grade were in the range of $1,540-$1,560/t. SteelMint's price assessment for 304-grade stainless steel stands at $1,550/t, CFR Mundra.

Ferro alloys market

Indian ferro chrome prices inched up as supply concerns in the domestic market fuelled worries among buyers. Indian ferro chrome (HC60%) prices stood at INR 107,000/t ($1,303/t) exw-Jajpur.

Market participants stated that domestic ferro molybdenum prices saw a downtrend last week. Domestic ferro molybdenum prices of FeMo 60% material stood at INR 26,60,000/t ($32,408/t).

Similarly, due to high input costs, Chinese ferro chrome producers have decided to cut output in April by about 65,000-75,000 t.

Outlook
Prices of stainless steel scrap appear to be stable but finished stainless steel demand remains gloomy and market participents are expecting price cuts in the coming days. This may impact prices of raw materials in the near-term.