India: SteelMint's billet index falls by INR 350/t on weak demand - 18 May

SteelMint's billet index fell by INR 350/t to INR 44,800/tonne (t) exw-Raipur on May 18, 2023.

The index fell due to lower bids and limited buying as buyers resisted booking material at higher offers. However, trade activity in the finished long steel segment remained low today. Market sentiments turned negative on declining offers from furnace owners and a significant price correction in north India.

Around 2,300 t of trade was recorded today in Raipur as against 3,300 t on 17 May.

SteelMint's price assessments for rebar inched down by INR 100/t, while wire rod prices fell by INR 300/t. Sponge iron prices, on the other hand, fell by INR 400/t in Raipur.

Around 600 t of wire rods and 800 t of rebars deals were recorded in Raipur.

The conversion spread from sponge iron (PDRI) to billets of the standalone furnaces in the region was recorded at INR 15,250/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) - Six trades at INR 44,600-44,800/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 44,800/t which is given a 50% weightage in the final price calculation. Apart from these one trade of INR 45,000/t recorded at 12:40 pm was excluded due to timing.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Six offers reported in the trading window and considered as T2 inputs. The average price of these six was INR 44,820/t and given a 50% weightage in the final price calculation.
  
  

The final price for billet exw Raipur was at INR 44,810/t, rounded to INR 44,800/t exw.

Click for detailed methodology

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