SteelMint | Morning Brief

Iron ore & pellets -

• Indian pellet export prices recorded a further increase after hitting a record high last week. SteelMint's weekly pellet export index (FOB east coast India) for Fe 64% grade increased by $2/t w-o-w to $210/t in anticipation of improved demand post holidays in China. In a confirmed trade recorded by SteelMint, a West Bengal based pellet maker has concluded a pellet export deal (Fe 63%, Al 4%) for 55,000t at around $226-227/t CFR China for Jun '21 shipment.
  
  
• India's production of iron ore in FY '21 has been recorded at around 207 mn t, with a sharp year-on-year decline in production from Odisha offsetting marginal hike in numbers from Karnataka and Chhattisgarh, SteelMint data reveals.
  
  
• Brazil - the world's second-largest iron ore exporter recorded an increase in its iron ore (including pellets) export volumes in Apr '21. Export volumes stood at 25.8 mn t in Apr '21, up by 8% as against 23.9 mn t in Apr '20, according to trade statistics released by Brazil customs.
  
  

Coal -

• India delivered metallurgical coke prices were mostly unchanged this week as downstream demand remained firm on healthy steel margins. The spot price for the 64% CSR grade blast furnace met coke stands at $418/t CNF India.
  
  
• South African RB2 (5500 NAR) grade coal portside offers rose marginally by INR 100/t yesterday even as a bulk quantity deal was heard to have been finalised at INR 6,850/t ex-Gangavaram. A sharp rise in API4 index due to Transnet's rail disruption and limited stock at RBCT port, supported offers.
  
  
• Coal India Ltd (CIL) has been forced to curtail its mining operations on account of drastic surge in COVID-19 cases.
  
  

Scrap & Metallics-

• SAIL conducted an auction today for 5,700 t (2,850 t x 2 rakes) of basic grade pig iron from its Bokaro Steel Plant, Jharkhand. Buyers booked the entire quantity at INR 36,750/t exw, sources reported to SteelMint. Bid price remained almost stable as compared to the previous auction conducted on 28 Apr
  
  
• SteelMint's benchmark sponge iron (P-DRI) prices fell by INR 200/t to INR 29,200/t ($396), exw Raipur, Central India. Lower bids, along with falling billet prices, created pressure on sponge prices.
  
  
• SteelMint's benchmark sponge iron (80 FeM, 100% lumps) export price assessment remained stable this week in view of modest demand due to volatility in prices in Indian domestic market. About 5,000 t fresh deals have been reported at $425-427/t CPT Benapole, equivalent to $440-442/t CFR Chittagong, Bangladesh.
  
  
• India's sponge iron exports plunged by 40% in FY '21 - slipping down to around 550,000 t from 910,000 t in FY '20, SteelMint data shows. The major factor for this was the decline in domestic sponge iron production following the Covid-19 outbreak and subsequent nation-wide lockdown.
  
  
• A leading steel mill in India has booked around 2,000 t of shredded scrap in containers recently. The deal was concluded for UK/Europe origin shredded scrap at around $480/t CFR Mundra basis, credible sources have reported to SteelMint. Prices have increased by around $5-10/t against the closing levels last week, in line with the hike in global scrap prices.
  
  
• SteelMint's domestic steel scrap index increased to INR 39,100/t DAP Mandi Gobindgarh. Lesser number of scrap offers in the market kept these offers supported despite marginal correction in semi-finished steel prices.
  
  
• Imported scrap offers in Bangladesh climbed to nearly a four-month high, even as trades remained muted. UK/EU origin shredded in containers is currently being quoted at $500-510/t CFR Chittagong levels, up by $10/t w-o-w.
  
  

Semi-finished steel-

• SteelMint's billet index fell by INR 350/t to INR 42,100/t exw Raipur on 5 May '21. A total of 3,200 t billet trades were recorded as against 4,200 t the previous day. Slowdown in demand owing to falling prices in North India was seen as the main reason behind the drop in prices.
  
  

Finished steel-

• SteelMint's benchmark prices for 2.5 mm thickness HRC stands at INR 66,500-67,500/t and CRC at 80,500-81,500/t exy-Mumbai. The prices mentioned above are exclusive of GST @18%. Despite the possibility of domestic demand being moderate due to rising covid-19 cases, we expect domestic steel prices to remain elevated in view of favourable international price trends.
  
  
• Steel Authority of India (SAIL) was unable to conclude HRC (S235JR/SS400) export tender of around 13,500-14,000 t for end-July shipments on expectations being higher than the bids received.
  
  

Ferro alloys -

• South Africa exported 1.77 mn t manganese ore in Mar '21, up 15.6% m-o-m. Improved mining operations in South Africa, increasing global silicomanganese prices, better demand due to increased production of carbon steel were the major factors contributing to rise in exports.
  
  
• Indian ferrochrome prices fell further by around INR 2.750/t w-o-w to INR 82,000-82,500/t ex-Jajpur amidst higher selling pressure. In the meanwhile, Chinese demand from the spot market has dried off amid the ongoing holidays and falling prices in the domestic market.