India: SteelMint's billet index drops further on weak finished steel sales - 3 Dec

SteelMint's daily steel billet index was assessed at INR 42,100/tonne (t) (- INR 400/t) exw-Raipur on 3 December, 2022.

The index fell on account of limited and low enquiries due to weak demand for finished steel products. Hence, the purchase of raw materials remained affected, resulting in the fall in spot trades of sponge iron and billets.

About 1,000 t of spot billet trades were recorded today in Raipur as against 900 t on 2 December.

SteelMint's daily price assessments for rebar and wire rods fell by INR 100/t, while sponge iron offers declined by INR 300/t d-o-d.

With the decline in billet prices, the conversion spread of the standalone furnaces in Raipur from sponge iron (PDRI) to billets moved down by INR 100/t d-o-d to INR 12,600/t.

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) - Four trades at INR 42,000-42,200/t were recorded during the 11:30 am to 3:30 pm SteelMint trading window and considered for final price calculation as T1 inputs. The average of these transactions was INR 42,110/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Fifteen offers reported in the trading window and considered as T2 inputs. The average price of these fifteen was INR 42,100/t and given a 50% weightage in the final price calculation.
  
  

The final price for billet exw Raipur was at INR 42,105/t, rounded to INR 42,100/t exw.

Click for detailed methodology

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