Indian sponge iron prices hit six month high: Mills may actively resume scrap import

Indian steel mills may resume imported scrap bookings actively, considering the recent sharp hike in sponge prices. Some of the reasons being attributed to this are as follows.

Sponge iron ore price surge on limited availability of iron ore - This has pushed domestic sponge iron (C-DRI) prices to six-months high level and are currently assessed at INR 20,200/t exw Raipur. Looking at the current situation, it appears that limited availability of merchant iron ore in Odisha may continue in near term which is likely to keep sponge iron prices supported. In particular, the coast based steel mills may raise scrap consumption, considering this situation and although SteelMint has learnt of a few bulk import scrap inquiries from Gujarat based mills, nothing could be confirmed till now.

Hike in Turkey imported scrap prices - Imported scrap offers to India have moved up further this week by around $10, ostensibly following the uptrend being witnessed in Turkey. However, trades remained slow at increased price levels, shared market participants.

Assessments and deals / offers being reported

• SteelMint's assessment for shredded 211 from UK/Europe stands at around $315/t CFR Nhava Sheva level, increasing by $5-10/t against last week's closing.
  
  
• Major Indian stainless steel producer has booked 4,000 t of shredded at $316/t CFR Nhava Sheva level.
  
  
• HMS 1 & 2 (80:20) scrap from the UK is being offered at around $282-285/t CFR Nhava Sheva.
  
  
• Offers for HMS 1&2 (80:20) from West Africa origin are being reported at $270/t CFR to Goa, up by $ 5/t against last week's report.
  
  
• Fresh offers from South Africa were also reported this week, despite a two months scrap export suspension as per new government trade policy. HMS was sold around $295/t CFR Goa.
  
  
• Dubai origin HMS scrap deals were reported at $280/t CFR Nhava Sheva, despite a temporary export ban imposed.
  
  

Domestic scrap prices - Domestic scrap prices in India have also increased due to similar factors as above. SteelMint's assessment for Jalna (Western India) stands at INR 22,900/t, up by INR 700/t as against last week's closing at INR 22,200/t DAP level.

Pakistan's imported scrap market remains active - Pakistani scrap buyers and steelmakers are reported to be holding firm with their price bids, while the suppliers are expecting this to change. Notwithstanding that, some trades of containerised shredded were reported recently at $308-310/t CFR Qasim. Fresh offers now stand at around $315/t, CFR. South African origin HMS 1&2 (80:20) grade scrap is being offered at $300/t CFR Qasim.