India: SteelMint's scrap index rises INR 400/t on active steel demand

SteelMint's domestic steel scrap (end-cutting) rose by INR 400/t d-o-d to INR 40,400/t DAP Mandi Gobindgarh on 5 Oct, 2023. Prompt demand for semi-finished and finished steel lifted market sentiment today. As demand escalates, mills are sourcing scrap in considerable volumes.

Semi-finished steel market

Steel ingot prices in Mandi increased by INR 500/t to INR 46,500/t at the time of reporting and price normalisation. Meanwhile, prices in other key markets increased by INR 200/t-400/t. Today, the market saw heightened trading activity with a surge in prices for both semi-finished and finished steel. The increase amounted to around INR 500/t for semis (ingot) and approximately INR 300/t, settling at INR 50,800/t, for finished steel (rebar).

Overview of other markets

Alang, Gujarat, observed a d-o-d rise of INR 200/t in ship-breaking melting scrap prices. According to SteelMint, HMS (80:20) prices were at INR 38,500/t exy. This price rise was driven by decent buying interest from induction furnace steel mills in Bhavnagar and moderate activity in the semi-finished steel sector.

The Raipur market saw decent trading activity, and prices for semi-finished and finished steel increased today. Billet prices rose by INR 500/t, reaching INR 44,000/t, and rebar prices climbed to INR 47,200/t, marking an increase of INR 900/t d-o-d.

In the Jalna market in western India, prices of semis inched up by INR 300/ to INR 45,800/t, while finished steel prices increased by INR 500/t to INR 51,200/t. On the other hand, HMS 80:20 prices remained stable at INR 36,800/t. In today's trading session, the market experienced active demand for finished steel. Arrival of scrap at mills remains at average levels.

Price highlights

End-cutting-billets spread: In Mandi, the end-cutting scrap and billets spread stood at INR 5,500-6,100/t.

Domestic vs imported scrap: Imported melting scrap prices at Nhava Sheva Port were at around $395-$398/t, which equates to approximately INR 35,339/t (including freight). Meanwhile, in Mumbai, local scrap prices stood at INR 36,500/t, constant d-o-d.

The imported ferrous scrap market in India improved slightly with active inquiries today, however, buyers are still reluctant to procure large volumes.

Offers for shredded scrap from Europe were heard at $410-415/t CFR Nhava Sheva, while, HMS (80:20) stood at $395-400/t CFR.

A source based in south India commented, "We have opted to observe the price trend over the next couple of days and, in the meantime, concentrating on domestic procurement."

Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stands at INR 13,350/t.

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