SteelMint's scrap index stable amid moderate demand for semis, finished steel
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SteelMint's domestic steel scrap (end-cutting) index remained stable d-o-d at INR 42,300/tonne (t) DAP Mandi Gobindgarh on 27 May, 2023. Today's demand for semi-finished and finished steel in the Mandi market was moderate.
In Mandi, steel ingot prices were stable at INR 47,400/t at the time of reporting and price normalisation. Prices in almost all key markets dipped by INR 100/t. Ingot makers were hoping for a price increase today, but, due to average demand, prices remained range-bound.
Weekly review
The mandi market experienced a mixed trend during the final week of May 2023. Scrap availability was moderate and ended the week with average supply. There were no bulk scrap purchase deals from the mills.
Imported scrap
In India, the ferrous scrap market saw slow trade activities, with mills opting for alternate raw materials like sponge iron in the northern and western regions. Market participants faced uncertainty, resulting in hesitation for new bookings. Although a major mill was rumoured to have made significant bulk bookings, confirmation is pending. However, containerized bookings of around 5,000-6,000 tonnes were concluded this week.
SteelMint's assessment for Europe-origin shredded scrap offers into India stood at $439/t CFR Nhava Sheva, unchanged w-o-w.
Overview of other markets
Ship-breaking melting scrap prices in Gujarat's Alang inched up by INR 100/t d-o-d on 27 May. HMS (80:20) prices opened at INR 38,700/t ex-yard. Demand for scrap remains moderate amid limited availability of material in the market. However, semi-finished and finished steel trade remained bearish in yesterday's session.
In the Chennai market today, prices of semis, finished steel, and HMS 80:20 remained stable and were assessed at INR 46,000/t, INR 51,500/t, and INR 35,400/t respectively. Demand for finished steel is still limited in the market, while scrap buyers (mill owners) are offering to pay extra to sellers to ensure a smooth supply of material.
Price highlights
End-cutting-billets spread: In Mandi, the spread between end-cutting scrap and billets stood at INR 5,000-5,500/t.
Domestic/imported scrap price gap: Imported melting scrap prices at Nhava Sheva Port were at $420-$425/t, which equates to approximately INR 37,290/t (including freight). Local scrap (HMS 80:20) prices in Mumbai stood at INR 37,800/t, up INR 300/t d-o-d.
Raipur sponge iron-billet spread: The current conversion spread (margin) from pellet-based DRI (P-DRI) to steel billets in Raipur stands at INR 15,450/t.
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