India: SteelMint billet index rises by INR 700/t on steel demand recovery - 7 Dec

SteelMint's daily steel billet index was assessed at INR 44,000/tonne (t) (+ INR 700/t) exw-Raipur on 7 December, 2022.

The index moved up following an improvement in finished steel demand specially wire rods. Hence, a majority of re-rollers have taken positions to secure raw material, resulting in an increase in spot trade volumes.

Billets transactions of 5,450 t were recorded today in Raipur as against 3,400 t on 6 December.

Also, rising steel prices in the northern region have positively influenced producers across regions to raise their offers.

SteelMint's daily price assessments for rebars increased by INR 500/t, wire rods by INR 900/t and sponge iron by INR 400/t d-o-d.

Owing to the rise in billets prices, the conversion spread of the standalone furnaces in Raipur from sponge iron (PDRI) to billets inched up by INR 300/t d-o-d to INR 13,500/t.

Spot wire rod trade has increased exponentially to 5,250 t today from 1,200 t recorded yesterday.

Rationale -

This index has been derived based on transactions, offers, bids and indicative price data sets. Transactions are considered as T1 and given a weightage of 50% whereas other data sets are considered as T2 and given a weightage of the balance 50%.

• Transactions (T1) - Seven trades at INR 43,900-44,150/t were recorded during the 2:30 pm to 5:30 pm SteelMint trading window and considered for final price calculation as T1 inputs. The average of these transactions was INR 43,272/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Thirteen offers reported in the trading window and considered as T2 inputs. The average price of these thirteen was INR 43,992/t and given a 50% weightage in the final price calculation.
  
  

The final price for billet exw Raipur was at INR 43,982/t, rounded to INR 44,000/t exw.

Click for detailed methodology

T1 - Trade, T2 - Offer/Bid/Indicative, *Normalized price as per methodology