Indian Steel Market Weekly Snapshot

Indian spot steel trade activities remained weak during the week-39 (21-28 Sep'19) on account of falling raw materials as well limited domestic & export inquiries with the mid sized mills.

As per assessment, in this week - Sponge iron, Billet & Rebar prices narrowed down by INR 200-800/MT (USD 3-11).

The prices constant on downtrend in across regions except in western India, where it finds support on account of curtailed productions. The prices moved up slightly in Gujarat & Maharashtra.

In line Flat Steel, the prices decline during the week by INR 500-750/MT in traders market.

IRON ORE and PELLETS

Serajuddin has decreased iron ore lump offers for 5-18 mm (Fe 63%) by INR 300/MT to INR 3,400/MT (ex-mines). Odisha Mining Corporation cuts its iron ore lumps base prices by INR 250/MT from all its mines in next e-auction schedule on 30th Sep'19. National Mineral Development Corporation (NMDC) had also decreased its floor prices by around INR 300/MT in both lumps and fines (depending on grades) for Karnataka e-auctions.

PELLEX stable at INR 5,950/wmt(DAP Raipur) amid limited trades this week. Raipur based pellet maker kept pellet offers stable at INR 6,000/MT (ex-plant). In Durgapur SteelMint's reference, pellet price decreased to INR 5,300-5,500/MT against INR 5,600-5,800/MT (ex-Durgapur, GST extra) last week.

No pellet export deals were reported. SteelMint's pellet export assessment stable on weekly basis at USD 105-106/MT, CFR China. However, few bids from Chinese mills were heard at USD 102-103/MT, CFR China.

COAL

Australian premium low-volatile hard coking coal prices plummeted this week, amid oversupply of lower quality seaborne cargoes and import restrictions in China. Chinese traders are concerned about a further drop in demand with the import quotas nearly exhausted at ports.

Indian demand for spot shipments of seaborne coking coal has been dampened by the prevailing bearishness in the domestic steel sector. There is a possibility of prices remaining at lower levels in the short term, with the potential for further deterioration in light of uncertainties and weaknesses in the global macroeconomic environment.

-- Latest offers for the Premium HCC grade are assessed at around USD 137.00/MT FOB Australia and USD 152.50/MT CNF India.

FERROUS SCRAP

Imported scrap offers to India dropped again this week, after a fall in Turkish scrap import prices earlier in the week resulted in a further global downtrend, while buying activity picked up after several weeks as the market is expecting a positive shift in the sentiments.

SteelMint's assessment for containerized Shredded from the UK, Europe and USA to India stands at USD 255/MT, CFR Nhava Sheva, down by another USD 5/MT against last week's report with decent bookings being witnessed at these levels. A global trader concluded 2,000 MT of Shredded scrap of UK and USA through containers, at USD 255/MT CFR this week.

HMS offers also have moved down by USD 5-10/MT over the week, depending on origin. HMS 1 offers from Dubai were reported to be at around USD 250-252/MT, CFR while UK origin HMS 1&2 offers were assessed at around USD 240-244/MT CFR.

FERRO ALLOYS

-- Silico Manganese prices are falling fast in the domestic market. Prices could go further down in line with tepid demand. Producers are still more inclined towards the exports market.

-- Prices of Ferro Manganese are low in line with tepid demand. In line with dull demand, the market is very competitive and the producers are offering at much lower rates.

-- Indian Ferro Chrome prices have remained stable as the supply situation in the domestic market remains tight and the prices are expected to increase in the coming week in line with the recent OMC Chrome ore auction.

-- Ferro Silicon Prices have gone down further in line with tepid demand from the buyers; however, the producers believe that this slide in prices might come to a halt on expected demand post the festive period in October.

SEMI FINISHED

This week, Indian Semi finished market observed less than average demand as Billet offers plunged in the range of INR 200-700/MT (USD 3-10).

While Sponge iron offers dropped by INR 200-900/MT and majorly in eastern India - Durgapur by INR 900/MT (USD 13) W-o-W. SteelMint learned that, improved supply amid weak demand in domestic & exports led to significant drop in price range in eastern region.

Inline, Steel grade pig iron prices in Indian domestic market fell by INR 100-500/MT due to less demand from domestic buyers amid fall in local billet prices.

-- Bangladesh has slowed down sponge iron bookings this week amid regular bookings in previous weeks. Latest offers for Indian sponge iron (80 FeM, 100% lumps) is hovering at USD 265-270/MT CPT Benapole (dry port of India & Bangladesh), this is equivalent to USD 280-285/MT CFR Chittagong, Bangladesh.

-- Indian mid sized mills export offers to Nepal is hovering at USD 370-375/MT for Billet & around USD 420/MT for Wire rod, ex-mill at Durgapur. The last deals for Billet learned at USD 360-365/MT ex-mill, equivalent to USD 390/MT CPT Raxaul/Jodbani border, Nepal.

-- Tata Steel's Pig iron auction held on 24th Sep'19 for around 3,000 MT Steel grade pig iron from its Bhushan Steel Plant in Angul (Odisha); had received good response as total allotted quantity was sold out with increase bid price by INR 200/MT to INR 22,500-22,600/MT ex-plant, as per participants.

-- Jindal Steel has offerd pig iron at INR 24,000/MT ex-Raigarh. Also offering panther shots (granulated pig iron) at INR 22,000-22,500/MT ex-Angul, Odisha.

-- SAIL's Rourkela Steel Plant tender held on 23rd Sep'19 to sell about 1,500 MT steel grade pig iron; had received average response. The base price for the tender was quoted by RSP at INR 24,000/MT and about 40% material sold.

-- As per sources, a government of India owned steel maker has concluded the 30,000 MT Bloom (IS 2830 grade) export tender at USD 380/MT, FoB.

FINISH LONG

Indian medium and small scale mills observed weak demand amid slow trade volume in this week as rebar prices get narrowed down by INR 100-800/MT in most of the regions except in western India (Mumbai) as few mills are not fully operational due to lack of conversion.

In major supplying location like Raipur (Chhattisgarh), Jalna (Maharashtra) few manufacturers are maintaining their production and inventory level as per market requirement and further assuming that price range won't get any major contraction for near term.

-- Current trade reference rebar prices (12-25 mm) through mid sized mills assessed at INR 30,700-31,000/MT Ex-Raipur (central region) & INR 31,400-31,700/MT Ex-Jalna (western region).

--Central region, Raipur based structure manufacturers have reduced prices by INR 300-400/MT in light and heavy sizes and maintaining the trade discount on heavy structure at INR 400-700/MT. Current trade reference prices at INR 34,200-34,600/MT (200 Angle) ex-work.

-- Trade discounts in Raipur wire rod is currently at INR 800-1,000/MT and trade reference prices stood at INR 30,500-30,700/MT ex-Raipur and INR 30,300-30,800/MT ex-Durgapur, size 5.5 mm.

FINISH FLAT

This week domestic HRC prices fell further by around INR 500-750/MT against last week in major markets as buyers turned silent over weak purchases and low demand prevailing in domestic market. Thus traders continue to remain in stress over limited inquiries.

Along with this ongoing monsoon season hinders the buying activities in the domestic market.

As per SteelMint price assessment trade reference prices for HRC (IS2062, 2.5-8 mm) is currently at INR 34,500-35,000/MT ex-Mumbai, INR 34,700-35,000/MT ex-Delhi and INR 36,500-37,000/MT ex-Chennai. Prices mentioned above are basic and extra GST@ 18% will be applicable.

Reference Prices as on 28th September 2019 (Week 39)

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

Indian Export Reference Prices as on 28th Sep'19

Prices in USD/MT
Source: SteelMint Research