India: SteelMint's scrap index drops INR 1,300/t w-o-w on lacklustre steel demand

SteelMint's domestic steel scrap (end-cutting) index fell by INR 700/t d-o-d to INR 40,500/t DAP Mandi Gobindgarh on 23 September, 2023. The market witnessed limited demand for semi-finished and finished steel and modest trade inquiries for domestic scrap. End cutting scrap prices dropped around INR 1,300/t w-o-w. Moreover, sponge iron (CDRI) prices fell by INR 200/t to INR 36,000/t DAP, while steel grade pig iron prices were assessed at INR 42,500/t, a decrease of INR 100/t d-o-d.

Mandi market: Weekly scenario

In the region, nothing much changed compared to last week as the market continues to observe a general downtrend. The scrap market remains silent, while the availability of imported scrap is decent. Disparity perisits in bids and offers, although scrap inventory is still good in the Mandi Ludhiana region. Trade activity in semi-finished and finished steel is slow and so scrap prices have dropped marginally.

Semi-finished steel market

Today, steel ingot prices in Mandi decreased by INR 250/t to INR 46,400/t at the time of reporting and price normalisation. Meanwhile, prices in other key markets dipped INR 300/t. The market witnessed minimal trade in semi-finished and finished steel.

Weekly price movements

Ingot prices in Mandi Gobindgarh fell by INR 900/t. End-cutting scrap prices dropped INR 700/t. Sponge iron (CDRI) prices decreased by INR 300/t, while rebar prices moved down by INR 300/t w-o-w.

Imported scrap market

The imported ferrous scrap market in India remained slow this week, with buyers taking a cautious approach due to price volatility and the impact of festivals on demand, especially in the western region. Market activity was limited, and small tonnage deals were sealed.

It was worth noting that offers were being diverted to India from Europe and the US due to favourable quotes compared to Turkiye's prices.

Overview of other markets

Gujarat: Ship-breaking melting scrap prices fell by INR 200/t d-o-d in Gujarat's Alang on 23 Sep'23, as per SteelMint's assessment. HMS (80:20) prices were assessed at INR 38,300/t exy. Trade participants seemed cautious amidst mixed sentiments in the market and lack of trades in semi-finished steel. That apart, disparity in bids and offers prompted suppliers to lower offers. Alang HMS (80:20) scarp prices fell by INR 900/t w-o-w.

Raipur: The market witnessed limited trade in semi-finished and finished steel, as the trading climate is inclement in the region over the past four-five days. Billet prices were assessed at INR 43,500/t, a decrease of INR 50/t d-o-d, while rebar prices dipped INR 200/t to INR 46,700/t.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread stood at INR 5,400-5,900/t.

Domestic vs imported scrap price: Imported melting scrap prices at Nhava Sheva Port were at around $406-$414/t, which equates to approximately INR 36,439/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 37,000/t, stable 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 13,150/t.

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