India: Stainless steel market sees prolonged downturn

Stainless steel prices remained weak this week. 304 grade stainless steel HRCs prices ex-Mumbai dropped by 4.6% and remained at INR 229,000/t ($2,817/t), while domestic 304 grade stainless steel scrap prices ex-Delhi were assessed at INR 129,000/t ($1,587/t)

Nickel prices on the LME appreciated around 4% compared to last week. LME's three-month nickel prices are hovering around $30,300/t currently.

Market highlights

The scrap offer price for India has increased as a result of the European purchase. "In comparison to India, scrap values in Europe are about $130 more. Currently, the landed price for 304 scrap and 316 scrap at Indian ports will be more than $1700/t and $3100/t, respectively," one trader with a base in Europe told SteelMint.

"There are plenty of scraps available on the market for $1,580-1,600/t. 316 scrap is necessary because molybdenum prices are high," one buyer based in north India shared.

The finished segment received mostly negative sentiments. The market for finished stainless steel has been declining for quite some time. Prices were lowered as a result of some short selling that was done to lessen the market's exposure to inventory.

Ferro chrome prices rise

According to SteelMint's assessment, ferro chrome prices were hovering at around INR 111,100/exw-Jajpur. Furthermore, hike in chrome ore prices due to good demand in Chinese ports also supported ferro chrome prices in India amid high production costs.

Molybdenum prices bullish

Last week, domestic and global ferro molybdenum prices edged up to about 13%. According to SteelMint, the FeMo 60% price increased to INR 4,412,500/t ($54,274/t).

Outlook

The domestic stainless steel market has had persistently low downstream industry demand. In addition, rising ferro chrome and scrap prices, raw material costs are also rising. In the upcoming months, government-supported projects might help the market.