India: SteelMint scrap index spikes on improved trade; supply shortage persists

SteelMint's domestic steel scrap (end-cutting) index climbed by INR 1,200/t to INR 44,300/tonne (t) DAP Mandi Gobindgarh on 17 June 2022.

Meanwhile, LMS (light melting scrap) prices were at INR 39,500/t, HMS 80:20 at INR 42,200/t, and CR busheling at INR 46,100/t.

Indian domestic steel producers mainly in the northen region are facing challenges in sourcing scrap. Buyers raised their bids to secure adequate volumes following a marginal increase in semi-finished steel prices. In the first half of the day, ingot prices in Mandi were at INR 49,000/t, which later increased to close at INR 49,700/t.

HR strip (patra) prices rose by INR 400/t d-o-d in Mandi Gobindgarh and Raipur on 17 June 2022. Current base grade patra (148-200mm, 2mm thick) prices stand at INR 52,000/t exw-Mandi and INR 51,200/t exw-Raipur.

Shipbreaking melting scrap prices increased by INR 300/t d-o-d in Gujarat's Alang, as per SteelMint assessment. HMS (80:20) prices are assessed at INR 40,500/t exy.

Heavy structural steel manufacturers in Raipur have hiked prices by INR 1,000/t. The current offer for 150mm channel stands at INR 54,500/t exw. The rise in steel billet prices in central India pushed suppliers to raise structure offers.

Market highlights-

o End-cutting and ingot spread: The spread between end-cutting scrap and ingots remained stable at INR 6,000/t today. Last week, the spread was at around INR 6,200/t.

o Domestic and imported scrap price gap: In Mumbai, imported melting scrap (HMS 80:20) of Dubai-origin was traded at $450/t CNF (INR 35,150/t) Nhava Sheva. Mumbai-based mills are preferring imported scrap because domestic material is costlier by around INR 800-1,000/t.

o Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur decreased by INR 100-200/t d-o-d to INR 15,000/t.

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