India: Stainless steel market continues to move southward despite hike in future prices

The stainless steel market has been experiencing a decline in demand due to reduced buying inquiries within the country, despite the rise in LME future prices. SteelMint's assessment indicated that the 304 HRC is presently at INR 178,000/t (tonnes) ($2,138/t) after a decrease of INR 2,000/t ($24/t) compared to the previous week. Meanwhile, the domestic scrap prices remained range-bound, with the 304-grade scrap at INR 112,000/t, ex-Delhi.

Similarly, offers for the 304-grade scrap were stable at around $1,340/t CIF Mundra. Furthermore, as per market participants, overseas scrap suppliers are reluctant to sell their material at lower rates, choosing instead to wait and observe the market post-holidays.

Recent challenges in the Red Sea shipping route have led China and Southeast Asian countries to increase prices for the 300 series due to a rising freight rate, but also due to bearish demand in the market, which might not impact much. China is facing low demand and tight supply.

Additionally, China's 304-grade CR prices were at $2,033-2,035/t, FOB China.

A reliable source has indicated that the market is still experiencing shortages of the 316 series, although the demand is not significant. Participants are purchasing on an as-needed basis.

Raw material market

• Ferro chrome: Indian ferro chrome prices (HCFeCr60%) inched up by 2.1% w-o-w due to a narrowing gap between bids and offers. According to SteelMint's assessment, high-carbon ferro chrome (HC60%, Si:4%) prices stood at INR 108,300/t exw-Jajpur.
  
  
• Ferro molybdenum: Indian ferro molybdenum prices increased by INR 3,05,000/t w-o-w. Indian ferro molybdenum prices stood at INR 2,445,000/t exw-Nagpur, on 60% pro rata basis.
  
  
• LME nickel: The nickel LME (London Metal Exchange) prices inched up w-o-w. Three-month nickel futures on the LME were up by 2.8% w-o-w and are currently hovering at $16,780/t despite limited demand in the global market. Similarly, the stocks of LME increased significantly by 4,110 t w-o-w to 52,698 t.
  
  

Outlook

Market players expect a sluggish stainless steel market with potential clarity after the holidays. Anticipate potential price reductions next week as demand in the finish segment remains exceptionally low from buyers.