India: SteelMint's scrap index remains range-bound on moderate steel demand

SteelMint's domestic steel scrap (end-cutting) index remained constant d-o-d at INR 42,400/t DAP Mandi Gobindgarh on 5 September, 2023. In Mandi, both trading sessions remained moderate, as no big volumes were heard traded in the region. GST raids have proved to be a stumbling block in daily operations.

Sponge iron (CDRI) prices remained stable at INR 36,300/t DAP, while pig iron prices were assessed at INR 43,000/t unchanged d-o-d.

Semi-finished steel market

Steel ingot prices in Mandi Gobindgarh remained at 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 the region, aggressive buying is absent right now in the semi-finished market. The rebar market rose by INR 200/t to INR 52,200/t on average work flow.

Imported scrap market

India: Today, the Indian imported ferrous scrap market exhibited moderate activity, with scrap importers exercising caution due to uncertainty surrounding available offers. European-origin shredded scrap is being offered at $440/tonne (t) CFR Nhava Sheva, while European HMS (80:20) scrap is priced at $420/t.
A deal for 4,000 t of European shredded scrap for West Coast India was heard at $430/t, whereas 800 t of US-origin shredded scrap was booked at $432 CFR Mundra.
Additionally, HMS (80:20) scrap from Western Africa, destined for the Mumbai and Chennai regions, was reported within the range of $414 to $418/t CFR.

Overview of other markets

Ship-breaking melting scrap prices in Gujarat's Alang market inched up by INR 200/t d-o-d on 5 Sep'23, as per SteelMint's assessment. HMS (80:20) prices were assessed at INR 38,500/t exy. The recovery in semi-finished steel prices in yesterday's trading session in the region triggered buying interest for scrap, resulting in a hike in scrap offers.

The Chennai market witnessed limited trade activity today as no major improvement seen in semi-finished and finished steel. Billet prices assessed at INR 48,500/t, while rebar prices stood at INR 52,300/t exw.

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 37,050/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 36,700/t, up by INR 200/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 stands at INR 13,850/t.

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