India: SteelMint's scrap index rises INR 200/t on moderate steel market
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On 6 December, 2023, SteelMint reported an uptick in domestic steel scrap (end-cutting) index, increased by INR 200/t (tonne) d-o-d, settling at INR 37,800/t DAP Mandi Gobindgarh. Additionally, steel ingot prices in the region were slightly up by INR 100/t d-o-d, reaching INR 43,300/t.
Mandi market: Weekly scenario
The majority of steel producers are optimistic about a potential upturn in both steel demand and prices in the steel segment. However, in the past few days, the market has displayed signs of softening, with overall moderate buying activity observed in the current week.
Scrap movement
The general flow of scrap in the market remained satisfactory. However, there has been a slight decrease in activity over the recent days. Mills are placing emphasis on consistently procuring domestic scrap, given that imported scrap is currently not deemed viable.
Weekly price movements
The prices of steel ingots have surged by INR 150/t, and end-cutting scrap prices in Mandi Gobindgarh have witnessed an increase of INR 300/t. Sponge iron (CDRI) prices experienced a rise of INR 100/t, and rebar prices saw a climb of INR 300/t w-o-w.
Raw material prices
The prices of sponge iron (CDRI) saw a decrease of INR 100/t, settling at INR 31,900/t. Meanwhile, pig iron (steel grade) prices in Ludhiana increased by INR 100/t to INR 40,400/t d-o-d.
Overview of other markets
The Alang market in Gujarat witnessed a drop of INR 300/t in ship-breaking melting scrap prices on 6 January, 2024, as reported by SteelMint. The assessed prices for HMS (80:20) were recorded at INR 34,700/t ex-yard. Traders exercised caution amid a mix of sentiments prevailing in the market and a lack of transactions in semi-finished steel. Furthermore, suppliers adjusted their offers downward due to discrepancies in bid and offer prices.
Raipur: Today, the semi-finished and finished steel markets in Raipur experienced minimal trade activity. Billet prices decreased by INR 200/t to INR 40,300/t, while rebar prices fell by INR 100/t to INR 43,500/t d-o-d.
Imported scrap market weekly trend
During the week, the purchasing interest for imported scrap in India remained subdued. This was primarily due to the availability of cost-effective alternatives in the domestic market, ample inventories held by steel mills, and uncertainty surrounding offers from Europe and the US, exacerbated by the Red Sea crisis leading to increased freight rates.
Shredded scrap offers experienced a marginal uptick of $2/t, reaching $412/t CFR Nhava Sheva, compared to the previous week's $410/t CFR. Similarly, This upward adjustment occurred towards the end of the week in response to the Turkish market's price hike.
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 $390/t-$395/t, which equates to approximately INR 35,036/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 33,500/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 stood at INR 13,000/t.
To see SteelMint's melting scrap assessment, pricing methodology and specification documents, Click here
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