India: SteelMint's ferrous scrap index rises by INR 200/t amid low demand for semis

SteelMint's India domestic steel scrap (end-cutting) index rose by INR 200/t d-o-d to INR 42,400/t DAP Mandi Gobindgarh on 30 May, 2023. Meanwhile, demand for semis was below average.

Ingot market trends

Steel ingot prices in Mandi increased by INR 250/t to INR 47,500/t at the time of reporting and price normalisation. Prices in other key markets rose by INR 200/t. Today, the Mandi market saw limited demand for semis. Buyers for semis kept silent in both sessions, while finished steel saw some demand compared to yesterday's session.

Mandi scrap market

Overall, the scrap market witnessed average business today, with only need-based mills approaching local scrap traders. Mandi scrap market's trade volume remained low.

Imported scrap

The market indicates that prices will drop in new offers for the upcoming days. However, trades remained gloomy as buyers are not actively available in the market.

EU-origin shredded scrap offers stood at $435/t, while the same grade from the US was offered at INR $430/t.

Overview of other markets

Ship-breaking melting scrap prices in Gujarat's Alang market edged down by INR 200/t d-o-d on 30 May. As per SteelMint's assessment, HMS (80:20) prices stand at INR 38,300/t exy. Falling semi-finished and finished steel prices continued to put pressure on scrap prices. Meanwhile, demand for steel making raw materials remains subdued in the market.

In the western India-based Jalna market today, prices of semis fell by INR 300/t to INR 45,000/t. Meanwhile, finished steel prices decreased by INR 500/t to INR 52,200/t. HMS (80:20) prices edged down by INR 100/t to INR 37,700/t. Due to the continuous decrease in domestic sponge prices, mills are currently utilising 30-40% sponge and 60-70% scrap, while demand for finished steel remains moderate in the market.

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 $418-$422/t, which equates to approximately INR 37,086/t (including freight). Local scrap (HMS 80:20) prices in Mumbai stood at INR 37,800/t DAP.

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stands at INR 15,450/t.

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