SteelMint: India Steel Composite Index slips on weak flat steel sentiment

SteelMint's India Steel Composite Index declined slightly, with the rise in long steel sub-indices minimising the impact of the decline in the flat steel sub-indices for this week. The index was assessed at 155.1 on 14 Jan'22 compared with 154.4 a week ago. However, dropped by 1% over the last one month.

The India Steel Composite Index is backed by robust calculation methodologies and is derived from the long steel and flat steel composite indices. The Index serves as a benchmark for end-users, EPC contractors, and manufacturers in the iron and steel industry to settle contracts or understand the market cost of physical supply of commodities such as rebar, wire rod, structurals, HRC, CRC, plates as well as galvanised plates.

• The Composite Index is assessed on a weekly basis: every Friday at 18:30 IST, as per the weighted average prices based on manufacturing capacity and production.
  
  
• SteelMint considers the Composite Index with the base year being 3 Jan'20 (financial year 2019-2020) and the base value as 100.
  
  
• The Composite Index doesn't give the absolute price.
  
  
• The Indian steel industry is broadly classified into the BF-BOF and the electric/induction furnace routes. Keeping this broad classification in view, SteelMint proposes to release the Composite Index by considering both production routes by manufacturing capacity and the production weighted method to compute the index for India. For details click to view the methodology document.
  
  

Flat steel index falls:
The flat steel index stood at 165.5, slightly down from 166.8 last week. Trade momentum slowed with reduced enquiries keeping HRC and plate prices range-bound in key markets. However, CRC and coated steel products witnessed a drop in most markets.

India's Index of Industrial Production (IIP) showed a decline on the month to 129.6 in Nov'21. The index values were 136.1 for Oct and 128.5 for Nov'20. Concerns around the recent surge in Covid cases in India weigh on sentiments, as per the Ministry of Statistics and Programme Implementation (MoSPI).

On the contrary, the long steel index increased by 2% to 145.1 this week against 142.4 a week back. Higher prices of raw materials boosted prices of induction furnace steel products, although BF-route products witnessed a marginal decline. Market sources reported healthy trades till mid-week, although sentiments declined towards the weekend.