Indian Steel Market Weekly Snapshot

Indian semi finished steel market observed average inquiries from the domestic buyers. However export demand was quite good, thus prices through the mid scale mills remained volatile during this week. Major mills are expected to raise finished steel prices for Dec'19.

In context to supply, the manufacturers are maintaining production as per demand, hence there are no major stock in semis products amid sufficient orders with them.

As per assessment made by SteelMint, this week prices of Semis & Finished long steel products through the mid scale mills have fluctuated by INR 100-400/MT (upto USD 6). However, the domestic flat steel prices further increase by INR 500-750/MT by major mills.

IRON ORE and PELLETS

Odisha merchant iron ore miners kept the prices unchanged this week. Last week few merchant miners had increased iron ore lumps (5-18) offers by INR 200-300/MT. Odisha govt. extends bid submission due date for Iron ore & Manganese mine auctions - Phase III to 3rd Feb'20.

-- PELLEX down by INR 50/MT to INR 6,150/wmt (DAP Raipur) amid deals from Odisha. In Durgapur SteelMint's reference, pellet price increased by INR 200/MT to INR 5,700-5,900/MT (ex-Durgapur, GST extra). Bellary based major pellet maker concluded around 40,000-42,000 MT pellet deal at INR 6,200-6,350/MT ex-plant.

-- Jindal SAW has raised pellet offers by INR 150/MT to INR 8,050/MT (delivered Kandla) against INR 7,900/MT last week.

-- No pellet export deals were reported this week. SteelMint Pellet export assessment stands at USD 97-98/MT, FoB India.

COAL

Australian coking coal prices have held mostly steady over the past two weeks, with Chinese steelmakers continuing to procure imported materials despite stringent import restrictions at the country's major coal-handling ports.

China's domestic coking coal prices have found stability in recent days on the back of higher domestic metallurgical coke prices. Currently, spot prices for seaborne coking coal cargoes are relatively cheaper compared to domestic materials in China. At this juncture, the implementation of Chinese import restrictions beyond this calendar year remains ambiguous in the midst of fears that they may possibly extend until the Chinese New Year in late January.

-- Latest offers for the Premium HCC grade are assessed at around USD 133.75/MT FOB Australia and USD 147.25/MT CNF India.

FERROUS SCRAP

India's imported scrap market has remained mostly silent with buyers generally keeping away from concluding any deals. Offers for imported scrap remained mostly stable; however, after a rise in Turkish prices this week, there is a likelihood of a further upward in the coming week.

-- SteelMint's offers for containerized Shredded from the UK, Europe and the USA to India remain flat at around USD 285/MT, CFR Nhava Sheva, almost unchanged against last week's report with no major trades for Shredded scrap were reported on low buying interest, as domestic market sentiments remain weak.

-- HMS 1 offers from most origins were assessed at USD 270-273/MT, while HMS 1&2 (80:20) from Europe was offered at around 260/MT CFR Nhava Sheva. UAE origin HMS 1 super (no ci gi) was reported in the range of USD 270-275/MT, while West African HMS 1&2 (80:20) stood at USD 255-260/MT CFR Nhava Sheva.

FERRO ALLOY

-- Silico Manganese prices increased amid restricted supply in the market. Most of the producers are operating at a much lower capacity. Current assessment in Durgapur is at INR 58000/MT whereas, in Raipur, prices are at INR 57000/MT

-- Ferro Manganese prices have increased due to low supply in the domestic market. Prices are likely to increase amid less availability of material and ore prices firming up.

-- Ferro Chrome prices remained depressed owing to the selling pressure and low demand in the domestic and overseas markets. Prices are now at bottom levels but can go further lower if suppliers need to generate cash flow.

-- Ferro Silicon prices in Bhutan and Guwahati increased, as the inquiries started increasing and the supply situation is tightening.

-- State-owned, MSTC - Karnataka has reduced base price for Manganese ore auction by up to 25% and the quantity is offered about 31,752 MT, which is scheduled to be auction on 25 Nov'19.

SEMI FINISHED

Indian Semi finished steel market observed volatility in prices on fluctuating demand. Billet offers fluctuated in the range of INR 100-400/MT & Sponge offers by INR 100-200/MT W-o-W.

However, the mills in eastern India reported good demand for exports to Nepal and healthy deals concluded for Billet & Sponge iron amid firm price range.

-- As per officials from Jindal Steel, pig iron (steel grade) traded at INR 24,000/MT ex-plant, Raigarh, Central India.

-- Sources reported 4-5 rakes of sponge C-DRI (FeM 80) export to Nepal at around USD 265/MT CPT Raxaul/Jogbani border, Nepal.

-- Indian sponge iron exporters have concluded export deals to Bangladesh for about 5,000-6,000 MT at around USD 270/MT CPT Benapole (dry port of India & Bangladesh). This is equivalent to USD 285/MT CFR Chittagong, Bangladesh.

-- SAIL's Rourkela Steel Plant tender held on 28th Nov'19 to sell about 4,700 MT steel grade pig iron; had received good response. The company was sold out about 3,000 MT pig iron at a base price of INR 23,050/MT EXW-Rourkela.

-- Nepal mills actively book Indian induction grade BILLET (100*100 mm) at around USD 395/MT CPT Raxaul border. Around 3 rakes of booking reported by Durgapur & Odisha based manufacturers.

-- Pig iron prices drop in northeast regions by INR 200-400/MT on improved supply and less demand supply. The offers of steel grade pig iron stood at INR 22,500-22,700/MT ex-Jajpur(Odisha), INR 23,600-24,000/MT ex-Durgapur, INR 23,300-23,400/MT ex-Bokaro(Jharkhand) & INR 26,000-26,200/MT FoR Ludhiana.

-- India's state owned steel maker under the Ministry of Steel - Vizag Steel had concluded the two lots (15,000 MT each) of billet export for 150*150 mm at around USD 400/MT, FoB.

FINISH LONG

Indian Finish long steel market observed moderate response in terms of trade prospects and as per weekly assessment rebar price range has been fluctuated by INR 100-400/MT in over all regions. Further the trade participants are assuming that, the supply movement might remain near to average level amid measured production level.

-- Current trade reference rebar prices (12-25 mm) through midsized mills assessed at INR 29,500-29,800/MT Ex Raipur (central region) & INR 31,100-31,400/MT Ex-Jalna (western region).

Inline with this, the large scale mills are planning to increase finish long steel prices by INR 500-1,000/MT for Dec'19 deliveries on account of better demand & increase in raw material prices globally. In addition, healthy export orders is a key factor behind expected hike in domestic prices.

-- Central region, Raipur based heavy structure manufacturers have maintained trade discount of INR 1,000-1,500/MT and Current trade reference prices stood at INR 33,400-33,800/MT (200 Angle) ex-work.

-- Trade discounts in Raipur wire rod is currently at INR 1,200-1,500/MT and trade reference prices stood at INR 30,000-30,500/MT ex-Raipur and INR 30,800-31,000/MT ex-Durgapur, size 5.5mm.

-- APL Apollo Tubes Ltd, has increased ERW Pipe price by INR 500/MT yesterday to INR 38,500/MT (USD 537); ex-plant in central India, Chhattisgarh.

-- SAIL's Central India based Bhilai Steel Plant (BSP) offered 5.5 mm wire rod at around INR 31,500/MT ex-work.

-- RINL has concluded 14,500-15,000 MT wire rod export tender (whose validity till 22nd Nov'19) at around USD 430-435/MT, FoB India.

FINISH FLAT

Indian steel mills are planning to increase flat steel prices by around INR 500-1,000/MT (USD 7-14/MT) in Dec'19, as per trade sources. Surge in international prices, decent export bookings reported to Vietnam by Indian mills for Jan'20 deliveries have collectively pushed mills to go for price hike in Dec '19.

Meanwhile in trade market, domestic HRC & CRC prices continue to witness uptrend on weekly basis over gradual improvement in trade inquiries.

Thus on weekly basis domestic HRC prices moved up by INR 500/MT. As per SteelMint's price assessment, current trade reference prices in traders segment for HRC (IS2062, 2.5-8 mm) is at INR 35,250-35,750/MT ex-Mumbai and INR 34,800-35,000/MT ex-Delhi.

Inline domestic CRC prices moved up by INR 500-750/MT W-o-W basis. Currently, domestic CRC (0.9 mm, IS 513) trade reference prices are hovering around INR 39,500-41,000/MT ex-Mumbai and INR 39,000- 41,000/MT ex-Delhi. Prices mentioned above are basic, and extra GST@ 18% will be applicable.

Indian HRC export prices to Vietnam: Indian HRC export prices to Vietnam moved up by USD 10/MT in the beginning of this week. Latest offers from Indian mills stand at USD 470/MT, CFR Vietnam for Jan'20 shipments which was USD 455-460/MT CFR Vietnam.

Reference Prices as on 30th November 2019 (Week 48)

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

Indian Export Reference Prices as on 30th Nov'19

Prices in USD/MT
Source: SteelMint Research