India: SteelMint domestic scrap index edges up by INR 200/t d-o-d but market sluggish

SteelMint's domestic steel scrap (end-cutting) index inched up by INR 200/tonne (t) d-o-d to INR 42,500/t DAP Mandi Gobindgarh on 25 May, 2023. In the Mandi market, demand in semis and finish steel was limited. As a result, overall, the market was silent today.

In Mandi, steel ingot prices edged up by INR 200/t to INR 47,600/t at the time of reporting and price normalisation. Prices in almost all key markets increased by INR 100-200/t. In the first half of the trading session, ingot prices opened on a positive note, but in the second half, because of very limited demand, the market dipped and prices of steel ingots fell by up to INR 100/t.

Market trends

Over all, both trading sessions saw limited inquiries for scrap as well as for ingots today. The availability of scrap is moderate, while mills did only need-based buying of domestic scrap.

Imported scrap

Indian imported ferrous scrap prices in shredded grade is at $440-$445/t. A few deals were heard before the last closing, but market expects no major activity this month at least.

Overview of other markets

Ship-breaking melting scrap prices in Gujarat's Alang went up by INR 300/t d-o-d on 25 May. As per SteelMint's assessment, HMS (80:20) prices stand at INR 38,800/t exy. An increase in semi-finished steel prices in the region along with moderate scrap buying from Bhavnagar-based induction furnace mills prompted suppliers to raise offers.

Sluggish market conditions continued in Chennai, as demand for semis and finished steel was limited today. Billet prices in Chennai stood at INR 46,000/t, while rebar prices in this city were assessed at INR 51,500/t exw.

Price highlights

End-cutting-billets spread: In Mandi, the spread between end-cutting scrap and billets stood at INR 5,000-5,500/t.

Domestic/imported scrap price gap: Imported melting scrap prices at Nhava Sheva Port were at $420-$425/t, which equates to approximately INR 37,385/t (including freight). Local scrap (HMS 80:20) prices in Mumbai stood at INR 37,300/t, stable d-o-d.

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stands at INR 15,700/t.

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