Indian Steel Market Weekly Snapshot

During the week 50, India's spot steel trades of mid sized mills have improved in major locations following increase in offers by INR 100-500/MT. Also trade volumes better than last week, as stated by participants.

As per producers, inventories have narrowed down as sufficient bookings were made by domestic buyers. As per SteelMint's assessment, this week prices of Semis Finished steel products surged by INR 100-500/MT (upto USD 7). However the Flat steel prices were more or less firm due to constant rise since couple of weeks.

IRON ORE and PELLETS

Odisha based merchant iron ore miners have kept their offers firm but assumptions are high for hike in offers in coming days. SAIL's iron ore fines tender from all the three mines for sale has been extended for the next month due to some state govt. permission issue.

-- PELLEX increased by INR 100/MT to INR 6,250/wmt (DAP Raipur) amid thin trade. Raipur based pellet offers remain stable at INR 6,300/MT ex-plant. Bellary based pellet makers have sold around 33,000-34,000 MT pellets at INR 6,100-6,300/MT (EXW) in the last one week. Durgapur pellet offers increased by INR 100/MT to INR 5,900-6,100/MT (ex-Durgapur, GST extra).

-- Jindal SAW had also increased offers by INR 250/MT to INR 8,150/MT (delivered Kandla) this week.

-- Southern India based pellet maker - KIOCL has concluded pellet export deal for 50,000 MT consisting of Fe 64% content with less than 2% alumina yesterday (13th Dec 2019) for immediate shipment at around USD 106.1/MT, FoB India. In another Odisha based pellet maker export deal (Fe 64% and 3% Al) at the beginning of this week for Dec concluded at around USD 114/MT, CFR China.

COAL

Australian premium low-volatile hard coking coal prices have inched up this week, on the back of new future bookings concluded at slightly higher levels in China, although the spot market saw few bookings reported in China. Demand from Chinese steelmakers has been increasing steadily and currently it seems that major producers still have tonnage to move.

At the moment, it appears that the domestic miners are confident that prices will remain unchanged in the first quarter of the New Year. Nevertheless, spot prices may possibly start inching up further provided there is clarity on Chinese port restrictions.

-- Latest offers for the Premium HCC grade are assessed at around USD 136.50/MT FOB Australia and USD 151.60/MT CNF India.

FERROUS SCRAP

Imported scrap offers to India moved up sharply through this week, on a continuous global uptrend. Apart from few trades in Mumbai and Goa markets, buying stood slow as domestic scrap available at lower price levels, this kept most buyers away from imported scrap.

-- Assessment for containerized Shredded from the UK, Europe and the USA to India surged to USD 300-304/MT, CFR Nhava Sheva, up by around USD 10/MT against last week, with very few deals of shredded being concluded at USD 302-303/MT for CFR Nhava Sheva this week.

-- Offers for HMS 1&2 (80:20) from Europe now stand at around USD 275/MT CFR, up by USD 5-6/MT W-o-W. While, Australian HMS offers stood at USD 280/MT+ levels CFR. No major offers for South African material were observed this week.

-- UAE origin HMS 1 super (no ci gi) from Dubai was reported at around USD 280/MT CFR Nhava Sheva with few sales reported. West African HMS 1&2 (80:20) was sold in decent quantity at around USD 270-271/MT CFR Goa earlier in the week, while offers now stand at USD 275/MT CFR Goa.

-- Imports of scrapped ship imports to India - Alang, Gujarat has registered sharp fall of around 42.2% M-o-M & reached at 66,586 LDT in Nov'19, as per the data maintained by SteelMint.

-- The Lok Sabha on Monday (9th Dec'19) passed the Recycling of Ships Bill, 2019 that seeks to restrict the use of hazardous materials on ships and provide safety cover to workers. Now the yards in India operate in accordance with the standards of the Hong Kong Convention.

FERRO ALLOY

-- Silico Manganese prices increased amid short supply as most of the producers are operating at low capacity and are with low inventory.

-- Ferro Manganese prices remained stable despite the Manganese ore shortage. Demand in the export market remains moderate.

-- Ferro Chrome prices remained depressed owing to the selling pressure and low demand in the domestic and overseas markets. Current assessment is at INR 60,000/MT ex-Jajpur.

-- Ferro Silicon prices in Bhutan remained stable as most producers in Bhutan are out of stock. Trading remained suspended from Guwahati due to curfew since Tuesday this week.

SEMI FINISHED

On a weekly basis, Indian Semis market showed improvement, in which domestic Sponge iron offers surge by INR 100-200/MT & Billet by INR 100-500/MT (USD 1-7).

In these period major rise of INR 500/MT in billet seen in southern India on account of improved demand & rising scrap prices globally.

Meanwhile, pig iron prices remained firm on average demand-supply in major locations of Central & Eastern India.

-- Jindal Steel (Raigarh) sold about 3,000 MT sponge P-DRI at Rs 15,750-16,000/MT ex-plant on 14th Dec'19. Inline panther shots & pig iron remained less available with the company due to healthy export orders, as stated by officials.

-- Indian sponge iron export demand remained active and deals learned over 5,000 sponge C-DRI at near to USD 269-270/MT CPT Benapole, equivalent to USD 285-288/MT CFR Chittagong, Bangladesh.

-- Induction grade billet export deals reported at around USD 370-372/MT ex-mill at Durgapur, this landed cost to Nepal would be around USD 390-395/MT CPT Raxaul/Jogbani border, Nepal.

-- Rashtriya Ispat Nigam Limited (RINL) - state owned steel maker under the Ministry of Steel, has issued spot sales notice for export of 50,000 MT Bloom.

-- SAIL has schedule an auction to sale 2,500 MT basic grades Pig iron on 18th Dec'19 from its Rourkela Steel Plant (RSP).

-- Bhilai Steel Plant (SAIL) has received decent response for its 20,000 MT steel grade pig iron offer floated on 5th Dec'19 & the total quantity booked at around INR 24,100/MT ex-plant, as per sources.

FINISH LONG

Indian Finish long steel market observed moderate demand, hence the price range marked slight fluctuation of INR 100-300/MT in most of the regions except in south India - Chennai, where it has moved up by INR 500/MT following surge in raw material (scrap & billet) prices.

Moreover since couple of days, demand slightly improved in specified locations of western region. Also, the participants are hopeful that price range to remain supported on account of strengthening raw materials and anticipated improve demand of finished steel through the medium/small scale mills with sufficient trade volume in the coming days.

-- Current trade reference rebar prices (12-25mm) through mid-sized mills assessed at INR 29,400-29,600/MT Ex-Raipur (central region) & INR 30,900-31,300/MT Ex-Jalna (western region) & INR 32,400-32,700/MT Ex-Chennai (south region).

-- Central region, Raipur based heavy structure manufacturers have maintained their offers stable on a weekly basis and trade discount slightly stretched by INR 100-300/MT to INR 1,200-1,600/MT. The Current trade reference prices stood at INR 33,300-33,700/MT (200 Angle) ex-Raipur.

-- Trade discounts in Raipur wire rod is currently at INR 1,200-1,400/MT and trade reference prices stood at INR 29,700-30,000/MT ex-Raipur and INR 30,700-31,200/MT ex-Durgapur, size 5.5 mm.

-- APL Apollo Tubes Ltd, has increased ERW Pipe price by INR 1,000/MT on 11th Dec'19 to INR 39,500/MT (USD 558); ex-plant in central India, Chhattisgarh.

-- Indian large mills concluded 2 rakes of wire rod (equivalent to 5,500 MT) export deals to Nepal at near about USD 455-460/MT CPT Raxaul/Jogbani border, Nepal.

FINISH FLAT

This week domestic HRC prices remain range-bound in major markets of India. However, the trade segment reported that sales volumes remained dull this week against last week.

Current trade reference price for HRC (2.5-8 mm, IS2062) continues to hover at INR 35,500-36,000/MT ex-Mumbai, INR 35,500-36,000/MT ex-Delhi & INR 36,000-36,250/MT ex-Chennai. However, prices reported an increase in the Delhi region this week over improved sentiments in northern India. Meanwhile, the domestic CRC (0.9 mm, IS 513) prices assessed at INR 40,000-41,000/MT ex-Mumbai, INR 40,000-41,500/MT ex-Delhi & INR 40,000-40,500/MT ex-Chennai. Prices mentioned above are basic, and extra GST@ 18% will be applicable.

Demand continued to remain sluggish this week over weak purchases. However major steel mills are aiming for higher steel prices in Jan'20 in anticipation of better demand in the near term.

Reference Prices as on 14th December 2019 (Week 50)

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

Indian Export Reference Prices as on 14th Dec'19

Prices in USD/MT
Source: SteelMint Research