India: SteelMint's scrap index inches up by INR 300/t on active steel demand

SteelMint's domestic steel scrap (end-cutting) rose by INR 300/t d-o-d to INR 38,600/t DAP Mandi Gobindgarh on 10 November, 2023. Prompt demand for semi-finished and finished steel has boosted market sentiment today. As demand improves, mills are making efforts to procure scrap in substantial quantities, but the supply of scrap has been disrupted due to labour shortage ahead of the upcoming Diwali festival.

Steel ingot prices in Mandi increased by INR 300/t to INR 44,300/t at the time of reporting and price normalisation. Meanwhile, prices in other key markets increased by INR 200/t-500/t. Today, the market saw heightened trading activity with a surge in prices for both semi-finished and finished steel.

Overview of other markets

Alang: Ship-breaking melting scrap prices in Alang, Gujarat, increased by INR 600/t d-o-d on 10 November. As per SteelMint's assessment, HMS (80:20) prices opened at INR 36,800/t exy. Semi-finished and finished steel prices improved in the second half of yesterday's trading session in the region and active buying interest for scrap prompted suppliers to hike offers today.

Jalna: In the Jalna market, prices of semis improved by INR 500/t to INR 43,000/t, while rebar prices increased by INR 600/t to INR 49,300/t. On the other hand, HMS 80:20 prices edged up by INR 200/t to INR 34,000/t. In today's trading session, there was strong demand for finished steel. Meanwhile, mill owners have raised scrap purchase prices to secure a sufficient quantity of scrap ahead of Diwali.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread stood at INR 5,500-6,000/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $386-$390/t, which equates to approximately INR 34,500/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 33,500/t, constant d-o-d.

The demand for imported scrap in India remained largely inactive today due to fewer inquires in the market. However, indicative offers for shredded scrap from Europe were heard at $406-410/t CFR Nhava Sheva, while HMS (80:20) scraps were reported at $386-390/t CFR.

A trader said, "Indian market is currently not procuring because of low demand and we are observing this high price trend because of Turkiye. European supplies are likely to remain slow during winter so a few mills are thinking of buying at high prices but waiting for clarity to emerge after the holidays".

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

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