India: SteelMint's scrap index falls INR 500/t on soft steel demand

SteelMint's domestic steel scrap (end-cutting) index fell by INR 500/t d-o-d to INR 41,800/t DAP Mandi Gobindgarh on 26 June, 2023. The scrap market saw limited trade inquiries. Major mills reduced scrap buying due to limited demand for steel.

In Mandi, steel ingot prices opened on a positive note at INR 47,100/t. But, after the second half of the trading session, selling pressure mounted and prices fell by INR 300/t to INR 46,800/t. Moreover, the ingot market witnessed limited trade activity today. The market was quiet with only a few transactions being witnessed compared to yesterday's trading session.

Imported scrap market

Indian buyers are active in the market after a slow start to the week. Some inquiries were heard floated as offers edged down. However, steel producers expect further price correction amid forecast of heavy rains in western and central India.

Overview of other markets

Gujarat: Ship-breaking melting scrap prices in Alang declined slightly today. The price of HMS (80:20) scrap fell by INR 100/t to INR 38,800/t ex-yard. This decline was due to a slowdown in the semi-finished steel market and limited trading in scrap.

The Raipur market was silent today as no major deal was heard. Mills are operating at reduced capacity due to limited demand for semi-finished and finished steel. Billet prices in Raipur stood at INR 43,400/t decreased by INR 200/t, while rebar prices stood at INR 46,800/t, down INR 300/t.

In the Chennai market today, prices for semis and HMS 80:20 remained steady at INR 44,800/t and INR 34,300/t respectively, while finished steel prices decreased by INR 300/t to INR 49,200/t. The steel market witnessed sluggish trade activities on limited demand, while scrap arrivals to the induction furnace mills remained moderate.

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 $403-$408/t, which equates to approximately INR 35,668/t (including freight). Local scrap (HMS 80:20) prices in Mumbai stood at INR 36,600/t fell by INR 100/t d-o-d.

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stood at INR 16,200/t.

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