India: Stainless steel prices stable w-o-w; domestic scrap prices remain firm

In India, stainless steel prices have remained largely stable this week amid stability in LME nickel prices. Imported as well as domestic scrap prices remain firm this week.

India's stainless steel (304 series) HRC prices stood at INR 178,000/t ex-Mumbai and domestic 304-grade scrap at INR 122,500/t ex-works Delhi, BigMint's assessment reveals.

At the time of reporting, nickel prices on the LME saw a marginal drop of $125/t w-o-w. Nickel prices for 3-month delivery on LME fell by 0.8% to $17,142/t, which was previously hovering at around $17,300/t. Meanwhile, nickel stocks on LME stood at 97,872 t.

The LME reported a rise in nickel inventory to 97,000 t levels, almost a 2.5-year high. Despite this increase and a rebound in the US dollar, concerns over tight supply persist as Nornickel's Finnish facility faces potential delivery bans by the LME once more. However, with weak demand from the stainless steel sector, market expectations suggest that nickel prices could fluctuate in the near future.

Scrap market

In the domestic market, prices of 304 scrap were assessed at INR 122,500/t ex-Delhi NCR, with cash payment terms. Sources indicated that key mills are acquiring 304 scrap at around INR 123,000-125,000/t DAP, with a credit period of 45 days.

A trader informed BigMint, " There has been a notable uptick in inquiries for domestic scrap, driven by a preference among major mills and buyers to source locally. This increased demand has led to a marginal rise in scrap prices. The surge in domestic material demand is attributed to higher offers for imported scrap, exacerbated by escalating freight rates from Southeast Asia and logistical challenges such as port congestion and container shortages."

Notably, India's primary source of scrap, accounting for approximately 46%, is the Southeast Asian region.

Currently, freight rates from Southeast Asia to India's west coast stands at $200/t or $4,000/20-ft container.

This week, imported scrap prices have remained range-bound. BigMint's assessment indicates prices of 304-grade scrap remaining firm at $1,450/t CFR Mundra. Meanwhile, suppliers are pricing SS 304 scrap at $1,480-$1,500/t, while buyers are bidding lower at $1,430-$1,460/t, thereby leading to a disparity of $50-$60/t.

316-grade scrap stands at $2,650/t CFR Mundra. Meanwhile, a few suppliers were heard offering 316-grade scrap at $2,680-$2,700/t. However, buyers' bids were in the range of $2,630-$2,640/t.

Meanwhile, offers of SS 201 scrap stood at $780-$800/t, and SS 430 at $660-$680/t CFR Mundra.

Finished flat

In the finished flat segment, prices stood firm this week amid a slight increase in scrap prices. As per BigMint's assessment, 304 HRC prices stood firm w-o-w at INR 177,000-INR 179,000/t, while prices of SS 316 HRC stood at INR 308,000-INR 310,000/t ex-Mumbai.

A source said, "Despite weak market demand, prices in the finished segment remain firm largely due to increased inquiries for domestic scrap. Recently, LME nickel prices have had minimal impact on finished material prices, which are primarily driven by the prevailing demand-supply dynamics in the market."

Finished longs: indicative levels

In the finished longs segment, price indications for 304 black round bars were heard at INR 174,000-INR 176,000/t exw-Ahmedabad. Additionally, prices for SS 304 bright bars were heard at INR 199,000-INR 201,000/t ex-Ahmedabad.

Indicative offers of SS 316 black round bars were heard at INR 291,000-INR 293,000/t exw-Ahmedabad. Additionally, price levels for SS 316 bright bars were heard at INR 321,000-INR 323,000/t ex-Ahmedabad.

China market overview

During the week, China's domestic stainless steel prices were steady w-o-w. Prices of 304 grade CRC reached RMB 14,600/t ($2,007/t) ex-works. Meanwhile, FOB prices of 304 grade CRC stood at $2,095/t, up $22/t.

Raw materials scenario

Ferro molybdenum: Ferro molybdenum prices in India saw an uptick of INR 18,000/t ($216/t) w-o-w in comparison to the previous assessment on 3 July. Prices inched up following positive sentiments in the global market along with good domestic demand.

Indian ferro molybdenum prices were INR 2,730,000/t ($32,699/t) exw-Nagpur on a 60% pro rata basis, according to BigMint's assessment on 10 July.

Ferro chrome: Indian ferro chrome prices (HC, FeCr60%) stood at INR 110,300/t exw-Jajpur, down by INR 800/t w-o-w.

Outlook

Stainless steel prices are expected to remain range-bound or they may even witness a marginal decline driven by the downward trend in LME nickel prices as well as subdued buying interest.