India: SteelMint's ferrous scrap index up INR 400/t d-o-d on moderate trade activity

SteelMint's domestic steel scrap (end-cutting) index climbed INR 400/tonne (t) d-o-d to INR 42,400/t DAP Mandi Gobindgarh on 4 September, 2023. Moderate trading activity was seen in the Mandi market today but mills as well as scrap traders are expecting a strong rebound in prices in this week.

Meanwhile, availability of steel scrap was good in the market today. Sponge iron (CDRI) prices up by INR 100/t to INR 36,300/t DAP.

Steel ingot prices in Mandi Gobindgarh rose by INR 400/t to INR 47,700/t at the time of reporting and price normalisation. Prices in almost all key markets increased in the range of INR 100/t. In Mandi, no major deals were seen in the steel market at improved prices.

"The region is experiencing a GST raid, which is affecting the work flow of the market," a source informed SteelMint.

Imported scrap market

In India, demand for imported ferrous scrap was weak today as buyers adopted a wait-and-see mode in anticipation of a slight correction in offers. Indicative offers for containerised shredded scrap are at around $440/t CFR Nhava Sheva. Meanwhile, HMS (80:20) scrap is available at $420/t CFR Nhava Sheva.

Offers for HMS (80:20) on a CFR Chennai basis are heard at around $418-420/t. From the UK, offers for HMS (80:20) are coming in at around $422-$425/t, while buyers are bidding at $410-$415/t CFR Nhava Sheva.

Market observers suggest that in eastern India, the availability of alternative raw materials like pig iron is expected to increase due to higher production from major mills. Consequently, the demand for scrap in this region is likely to remain subdued for a certain period of time.

Overview of other markets

Ship-breaking melting scrap prices in Gujarat's Alang market inched up by INR 100/t d-o-d today. HMS (80:20) prices stand at INR 38,300/t ex-yard. Semi-finished steel prices in the northern region dipped in the last trading session. This, coupled with moderate buying inquiries for scrap, prompted suppliers to raise their offers. In the region, HMS (80:20) scrap prices rose by INR 1,000/t m-o-m.

Raipur: The Raipur market witnessed moderate trade activity for semi-finished and finished steel. Billet prices were assessed at INR 45,400/t, up by INR 250/t, while rebar prices stood at INR 48,600/t up INR 200/t d-o-d.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread stood at INR 5,000-5,500/t.

Domestic/imported scrap price gap: Imported melting scrap prices at Nhava Sheva Port were at around $414-$420/t, which equates to approximately INR 36,948/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 36,500/t, constant d-o-d.

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stands at INR 14,000/t.

To see SteelMint's melting scrap assessment, pricing methodology and specification documents, Click here

To provide feedback on this index or if you would like to contribute by becoming a data partner, please contact - info@steelmint.com.