India: SteelMint's billet index falls INR 250/t on weak finished steel demand - 10 Aug

SteelMint's billet index fell by INR 250/tonne (t) d-o-d to INR 41,750/t exw-Raipur on 10 August, 2023.

The index dropped as a result of negative market sentiment and weak finished steel demand. However, buying activity increased somewhat today due to lower semi-finished steel offerings. Due to cautious buying and a weakened steel market, material bookings remained limited.

Transactions for 1,400 t were recorded on Thursday against 1,020 t on 9 August.

The finished steel market also witnessed drop in prices across sub-commodities. Prices of wire rods moved down by INR 300/t, while those of rebar fell by INR 100/t. Sponge iron prices in Raipur declined by INR 200/t d-o-d.

Around 600 t of wire rods and 900 t of rebar deals were concluded in Raipur.

PDRI to billets conversion spread

The conversion spread from sponge iron (PDRI) to billets of the standalone furnaces in Raipur was recorded at INR 13,250/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) - Four trades at INR 41,700-41,800/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 41,742/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Nine offers reported in the trading window and considered as T2 inputs. The average price of these nine was INR 41,783/t and given a 50% weightage in the final price calculation.
  
  

The final price for billet exw Raipur was at INR 41,763/t exw, rounded to INR 41,750/t exw.

Click for detailed methodology

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