Weekly: Indian steel market snapshot

In week-32, Indian domestic steel prices increased due to shortage of raw materials & sponge iron in the market.

Further primary mills also increased rebar offers which influenced mid sized steel mills to increase their offers as well. However demand and trade activities in the market remained moderate. Trade participants reported a mixed response from the domestic buyers over uncertainty in the market scenario.

As per SteelMint's assessment, prices of semi finished & finished long products increased by INR 400-1,300/t this week through the mid-sized mills. Also finished flat steel prices have seen a hike due tight supply of thin gauge HRC and gradual restocking after weeks of subdued demand from the distributors side.

Iron Ore and Pellets

• Odisha based Essel Mining has increased its iron ore fines and lump by INR 150-300/t (ex-mines). Miner has hike prices thrice in the last 15 days.
  
  
• SAIL sold off 100,000 t (62.5% Fe iron ore fines) from its Bolani mines at an auction held on 7th Aug'20. The material was sold 16% over base price in the auction.
  
  
• SteelMint's bi-weekly domestic pellet index "PELLEX" increased by INR 300/t to INR 7,200/t (DAP, Raipur) this week amid lack of trades and tight supply in the Raipur market.
  
  
• Bellary based pellet makers sold a decent quantity and hike offer around INR 400/t to INR 6,800-7,000/t exw, Durgapur indicative price stands at INR 7,400/t exw.
  
  
• SteelMint's pellet index (FoB east cost India) has increased sharply by $7/t w-o-w to $107/t this week against $100/t, CFR China a week before.
  
  
• KIOCL concluded an export deal for 55,000 t for Fe 64% grade pellets with less than 2% Al was reported to be concluded at $117-118/t, FoB India for Aug'20 shipments.
  
  

Coal

The Indian seaborne coking coal market observed another quiet week, domestic coking coal prices continued to retreat on weaker demand as stockpiles at coal mines were building up. Overall trade volumes have indeed been much lesser over the past few months because of Chinese governmental restrictions hampering demand potentials and Indian steelmakers staying on the sidelines.

Accordingly, market participants anticipate that seaborne premium grade coking coal prices would remain relatively stable in the foreseeable short term.

• Latest offers for the Premium HCC grade are assessed at around $108.00/t FOB Australia, $118.50/t CNF China and $122.30/t CNF India.
  
  

Ferrous Scrap

Imported scrap offers to India have moved up further this week by around $10, following Turkish uptrend. Major Indian steel producer has booked 4,000 t of shredded at $316/t CFR Nhava Sheva level.

• SteelMint's assessment for shredded 211 from UK/Europe stands at around $315/t CFR Nhava Sheva level, increasing by $5-10/t against last week's closing.
  
  
• HMS 1 & 2 (80:20) scrap from the UK is being offered at around $282-285/t CFR Nhava Sheva. Australian origin premium HMS 1&2 (80:20) being quoted in the range of $295-300/t CFR level.
  
  

Ferro Alloys

• SAIL has scheduled an auction for around 800 t (3-10 mm) silico manganese on 10 Aug'20 from its Chandrapur Ferro Alloy Plant, Maharastra.
  
  
• Silico manganese prices seem to have bottomed out with little or no room for further correction. Most producers are now expecting the prices to go up as they anticipate a supply gap in the ore availability, which may boost up the prices on account of reduced silico manganese production.
  
  
• Ferro Manganese prices remianed stable in the week despite little trading activities. Prices expected to increase in line with the increasing manganese ore prices.
  
  
• Indian ferro chrome price has reduced marginally by 0.82% owing to rising selling pressure on the domestic producers. However, Scarcity of raw materials might put a brake on the ferro chrome prices from falling further.
  
  
• Indian ferro silicon prices are stable in Guwahati, while down by INR 1000/t w-o-w in Bhutan. Meanwhile, there is also a shortage in the market due to various logistical issues and labour unavailability. Along with it, the demand from stainless steel and the aluminium industry might come up soon with increasing production, which could provide support to the prices in the coming days.
  
  

Semi Finished

Indian semi finished market showed improvement, in which domestic sponge iron offers surge by INR 300-1,500/t & Billet by INR 500-1,300/t.

• On a weekly basis, India sponge iron (80 FeM, 100% lumps) export offers further surge by $10/t to $280/t CPT Benapole, equivalent to $300/t CFR Chittagong, Bangladesh. However no fresh deals as bids were reported at less by $15-20/t against prevailing offers.
  
  
• The mid scale mills billet export offers increased by $10-15/t to around $383-385/t exw Durgapur, equivalent to $410/t, CPT Nepal, via road delivery. Around 1,000 t deals reported at $380-382/t exw Durgapur, a couple of days ago.
  
  
• Steel grade pig iron prices remained strong and registered a hike of INR 1,000-1,200/t in central & eastern regions & around INR 1,500-1,700/t in north India due to supply crunch along with rising prices of substitute products.
  
  
• An Indian mill reported to have booked 60,000 t (150*150 mm, 3SP/4SP) bloom export tender at $395-396/t, FoB India.
  
  
• SAIL conducted an auction for 5,700 t foundry grade pig iron (2-rake loaded) on 5th August from its Bokaro Steel Plant, Jharkhand & the entire quantity got booked at INR 26,250-26,500/t exw.
  
  
• SAIL has floated an auction for 4,000 t prime steel grade pig iron to be held on 10 Aug'20 from its Bhilai Steel Plant, Chhattisgarh.
  
  
• Tata Metaliks has increased foundry grade prices by INR 1,200/t to INR 30,700/t & basic grade (Si 1-1.5%) by INR 700/t to INR 27,700/t exw Kharagpur, eastern India, for Aug '20.
  
  
• Vedanta hikes domestic Pig iron price by INR 1,000/t for Aug'20 on improved sales. Foundry grade offers reported at around INR 33,000/t DAP Gujarat.
  
  

Finished Long

India's finished long steel market of medium and small scale mills in this week notified an upward price trend by INR 400-1,300/t in most of the major supplying regions, except in the southern market where prices fluctuate by INR 100-400/t. As per the manufacturers, increase in raw material prices have pushed them to raise their rebar offers, however demand and trade activity in the market remained moderate.

• Trade reference rebar prices (12-25 mm) through midsized mills assessed at INR 32,300-32,600/t exw Raipur, INR 33,500-33,900/t exw Jalna.
  
  
• Trade discount given by Raipur based heavy structure manufacturers is at INR 500-800/t and the trade price of 200 Angle is at INR 36,000-36,400/t exw.
  
  
• APL Apollo Tubes Ltd, has increased Pipe price by INR 1,000/t to INR 39,500/t (USD 526); exw in central India, Chhattisgarh for Aug '20.
  
  
• Trade discounts in Raipur wire rod are currently at INR 500-700/t and trade reference prices stood at INR 32,800-33,600/t exw-Raipur and INR 32,300-32,700/t exw Durgapur, size 5.5 mm.
  
  

Finished Flat

Indian HRC prices have increased by INR 500-1,000/t this week on tight supplies and gradual restocking after weeks of subdued demand by distributors.

The SteelMint's benchmark price for HRC (2.5 mm, IS2062) increased to INR 38,500-39,000/t exw Mumbai (excluding GST).

Major Indian steel manufacturers have raised flat steel prices by INR 2,000/t w.e.f from 1st Aug'20 amid a steep hike in global offers & improved demand in the domestic market. Mills had raised list prices of HRC and CRC twice last month, by around INR 500-750/t in early-July and by INR 500-1,000/t from mid to end of Jul'20.

Reference Prices as on 8th Aug'20 (Week 32)

Prices are Exw & exclusive of GST

Indian export reference prices as on 8th Aug'20