Indian Steel Market Weekly Snapshot

During the 2nd week of 2019 (7-12 Jan), Indian domestic trade activities were subdued. The mid size mills reported mix response from the domestic buyers over uncertainty in the market.

As per SteelMint's assessment, in these days the prices of Semis products - Sponge iron declined by INR 200-500/MT, while Billet prices increased upto INR 700/MT (USD 10). Meanwhile Finished Long steel products registered price hike of INR 200-500/MT (USD 3-7) through the mid size mills.

In context to Flat steel, the prices have reduced by INR 200-500/MT (USD 3-7) through the traders end.

Iron ore & Pellets

National Mineral Development Corporation (NMDC) had announced a reduction in its Karnataka e-auctions floor prices by INR 320-330/MT in fines and INR 340-350/MT for lumps.

This week pellet prices in eastern and Southern India witnessed weak further, however offers in central India stable. Raipur based pellet makers haven't changed offers against the end of the last week assessment at around INR 6,000/MT (ex-Raipur) but the market sentiments are still low. Durgapur pellet prices have witnessed decline further this week by INR 5,500-5,600/MT against the beginning of this week's assessment at INR 5,600-5,700/MT.

According to market sources report to SteelMint, Central India based pellet maker - Godawari Power & Ispat Ltd. had concluded an export deal of 50,000 MT pellet for Fe 64% (+/-.5%) with 2% alumina from Gangavaram port yesterday (i.e 11th Jan'18).

Coal

Australian premium hard coking coal prices have further declined this week after the sharp fall last week, as inventories continued to build due to the continued lack of buying interest from end-users.

In China, there is sufficient supply from sellers, even as mining activities slow down during the winter season. Moreover, port inventories have continued to increase on more vessel arrivals, adding downward pressure on spot prices for seaborne coking coals.

Latest prices for the Premium HCC and 64 Mid Vol HCC grades are assessed at around USD 199/MT and USD 177.10/MT FOB Australia respectively. For Indian buyers, the above offers amount to USD 211.25/MT and USD 189.35/MT respectively on CNF India basis.

Scrap

Indian imported scrap market observed limited trades on reduced prices by USD 5-10/MT W-o-W. However as per participants, prices seem to have bottomed out and likely to remain steady in near term.

-- SteelMint's assessment for containerized Shredded stands in the range USD 315-320/MT, CFR Nhava Sheva. Offers from Europe and US stand mostly at around USD 320/MT and buying interest was seen at around USD 314-315/MT, CFR amid minor trades reported.

-- Dubai HMS 1 and South African HMS assessed at USD 320/MT, CFR and USD 318/MT, CFR. A few containerized trades of Dubai HMS were concluded at around USD 310/MT, CFR depending on quality.

Semi Finished

The Semis market registered volatility in prices as sponge prices plunged by INR 200-500/MT, while billet prices surged by INR 100-700/MT in major markets.

The supply of sponge iron continue to remain strong leading to price corrections and selling pressure among producers.

However on slight improved demand amid dipped conversions (margins) have forced billet producers to keep prices strong.

-- Mid size mills in eastern India concludes few export deals to Nepal, Billet around USD 435-438/MT & Wire rod at USD 510-515/MT ex-mill (Durgapur). Road freight from these mills to Nepal would be around USD 25/MT.

-- Indian sponge iron export offers reduced by USD 5/MT W-o-W, price assessment for 80 FeM sponge lumps are at USD 340-345/MT CFR Chittagong, Bangladesh.

-- JSW Steel has reduced gas based DRI offers for Jan'19 and latest offers hovering at INR 21,750/MT ex-plant, Dolvi, Maharashtra.

-- Neelachal Ispat Nigam Ltd (NINL) books 30,000 MT Pig iron after its recent domestic price reduction by INR 500/MT (USD 7) and offered Steel grade at INR 27,400/MT (USD 391/MT) & Foundry (High silicon) grade at INR 28,500/MT (USD 406/MT); ex-Cuttack, East India. In line the plant also offering pooled iron at INR 25,200/MT ex-Cuttack.

-- Jindal Steel has offered Steel grade pig iron at INR 28,200/MT ex-Raigarh & Panther shots at INR 26,300-26,500/MT ex-Angul, Odisha. Bulk purchase discount being offered of INR 300-500/MT on above of 2,000 MT.

-- Tata Metaliks, India's one of the major foundry grade pig iron manufacturer has reduced its prices by INR 600/MT to INR 32,500/MT ex-plant, Kharagpur, eastern India for Jan'19 deliveries.

-- SAIL cuts pig iron prices from its Bhilai Steel Plant (BSP) in Central India and latest offers for steel grade through the sources reported at INR 27,800-28,000/MT (USD 395-398) as against last month (Dec'18) at INR 29,100-29,500/MT (USD 413-419), ex-plant & excluding GST-Sources.

-- RSP (Rourkela Steel Plant) tender held on 5th Jan'19 for sale of about 9,400 MT steel grade pig iron in which about 4,500 MT was sold out at the base price of INR 27,200/MT, while remaining about 52% (4,900 MT) material remain unsold.

-- SteelMint's Pig iron export price assessment stood at USD 355-365/MT FoB India, USD 340-345/MT FoB Brazil & USD 340-350/MT FoB Black sea.

Finish Long Steel

Long Steel market remain volatile amid uncertain movement of raw materials and price range slightly increased by INR 200-500/MT in most of the regions, as per weekly assessment.

Further, market participants seems active from mid week and sentiments were improved specially in western region and back log were lifted up and considerable trade movement has been noticed in future selling through the brokers and traders.

Market participants assuming that market shouldn't get any major changes amid upcoming holidays in south and western regions but slight sale burden can be noticed after that.

-- Further, Raipur based Heavy structure manufacturers have maintained same discount range to INR 500-600/MT and current trade reference prices at INR 40,800-41,100/MT (200 Angle) upon booking quantity.

-- Current trade reference rebar prices (12-25 mm) assessed at INR 36,800-37,000/MT Ex- Jalna, INR 34,900-35,100/MT Ex- Raipur. All prices mentioned above are basic & excluding GST.

-- Most of the Indian mills have rolled over the prices in long products for Jan'18 deliveries despite the market is not very encouraging so far. As per sources, a large mill based in South India has provided incentives in rebar by INR 800-1,000/MT for the current quarter depending on the quantity.

-- Presently, few large mills are offering rebar in big infra projects at around INR 39,500-40,000/MT (ex-Chennai, size-12 mm, GST extra).

-- As per sources, Steel Authority of India Limited (SAIL) is offering wire rod 5.5-6 mm at around INR 41,500/MT (ex- Bhilai, GST extra, SAE 1008 grade).

-- Wire rod trade discount offered by the manufacturers/suppliers in Raipur is slightly increased compared to last week which is now at INR 800-1,100/MT.

Finish Flat Steel

SteelMint learned from market sources that this week Indian HRC prices in traders market have inched down in few key markets by around INR 200-500/MT, however in other regions prices have remained firm.

-- Current trade reference prices for HRC (IS2062) 2.5 mm-8 mm is around INR 42,000/MT (ex-Mumbai) and INR 41,500-42,000/MT (ex-Delhi). The prices mentioned above are basic prices excluding GST @ 18% on cash payment basis.

-- Currently trade reference prices for CRC (IS513) 0.9 mm is hovering in the range of INR 47,000-47,500/MT(ex-Mumbai) and INR 47,000/MT (ex-Delhi).The prices mentioned above are basic prices excluding GST@18% on cash payment basis.

Indian Raw material and Finished Steel reference Prices as on 12 January 2019 (Week 2)

Prices are Ex-works, Exclusive of GST at 18%

Indian Export Reference Prices as on 12th January'19

Prices in USD/MT
Source: SteelMint Research