Weekly: Indian steel market snapshot

Indian spot steel trades in the secondary market remained supported, as prices started rising from the beginning of the week. As per SteelMint's assessment during week-43, prices of semis & finished long steel products increased upto INR 1,700/t ($23). The major hike was noticed in western region by INR 1,300-1,700/t, following central & eastern India by INR 900-1,400/t.

In context to finished flat steel, domestic HRC and CRC markets exhibited mixed market sentiments this week. Prices in northern India have raised on tight material availability, although market sentiments softened in eastern and western India. On the other hand SAIL announced a 2nd price hike this month by INR 500-1,000/t.

Iron ore & Pellets

Amid tight availability of high-grade iron ore in the merchant market in Odisha recently dispatches of Sarda Mines (SMPL) have been stopped by the Odisha government even as the iron ore miner pursues its clearances with the Ministry of Environment and Forest, Climate Change (MoEFCC).

• SteelMint domestic pellet index "PELLEX" up by INR 400/t to INR 8,950/t DAP Raipur, amid hike in pellet offers and increased sponge prices during the week. Pellet prices in Bellary have increased by INR 200-300/t to INR 8,700-8,800/t exw owing to tightness of pellet supply. Pellet prices in other regions like Jamshedpur and Jharsuguda have also been increased by INR 300-500/t in the last one week amid hike in sponge offers.
  
  
• SteelMint's pellet export index (FoB east coast India) has increased by $2/t w-o-w to $126/t on 21st Oct'20. Few market participants expect Chinese stricter pollution control norms to boost pellet demand, however some traders highlighted limited buying interest at current indicative prices. One pellet export deal was heard to have concluded from eastern India at around $135-136/t CFR, China (equivalent to $124-125/t FOB India) recently.
  
  

Coal

• Australian coking coal prices continued their downward trajectory throughout this week on limited buying interest despite ample supply availability.
  
  
• While Chinese steelmakers stayed on the sidelines awaiting clarity on port restrictions, ex-Chinese steelmakers showed no urgency to book cargoes in hopes that offers could fall further.
  
  
• Oversupply concerns have emerged following deferrals and cancellations of pre-contracted coal shipments by some buyers in China, following the recently rumored import ban.
  
  
• Despite several November laycan cargoes of Australian premium coking coals being offered to India at competitive prices, there is not much incremental demand to liquidate the excess supply.
  
  
• Latest offers for the Premium HCC grade are assessed at around $104.75/t FOB Australia, $123.00/t CNF China and $117.40/t CNF India.
  
  

Ferrous Scrap

Imported scrap prices in India have climbed to one-month high in trades concluded this week. Tight scrap availability in yards and low collection rates have resulted in a hike in prices by around $5-10/t w-o-w.

• Steelmakers are actively replenishing their scrap inventories, before the winter holidays, as scrap yards may get closed for the holidays.
  
  
• SteelMint's assessment for shredded scrap in containers of UK/EU origin stands at $318/t CFR Nhava Sheva, up by $8/t w-o-w.
  
  

Semi Finished

Indian semi finished steel prices increased sharply as per SteelMint assessment, the domestic billet prices have increased by INR 500-1,700/t & sponge iron by INR 500-1,500/t. And it was also learned that sponge prices in Raipur have hit two-month's high as the major producers are holding sales due to supply concerns.

• SAIL is going to conduct an auction for 4,950 t steel grade pig iron from Rourkela Steel Plant, Odisha, on 28th October.
  
  
• Vizag Steel has floated an export tender of 30,000 t blooms (150*150 mm, 3SP/4SP grade) for spot sale, against 100% advance payment terms on 22nd Sep. The shipment is likely to be scheduled by 30 Nov'20.
  
  
• Vedanta Resources has concluded auction on 21 Oct'20 for 4,350 t foundry grade pig iron for Punjab (northern India). Market sources have reported SteelMint that bid price was around INR 31,000/t exw (equivalent to INR 34,600-34,700/t FoR Phillaur).
  
  
• Jindal Steel offered panther shots (granulated pig iron) at INR 27,400/t exw Angul, Odisha
  
  

Finished Longs

India's finish long steel market of mid-sized mills maintained an upward price trend consistently in this week as well, owing to active demand in rebar and structural steel along with strengthening in raw material prices in most of the major markets, rebar prices have increased by INR 200-1,200/t w-o-w, except in Gujarat market where one of the major mills have taken preventive maintenance shutdown which create short supply in the state and resulted price hike of more than INR 2,000/t.

• Trade reference rebar prices (12-25 mm) through midsized mills assessed at INR 33,500-33,700/t exw Raipur & INR 35,200-35,500/t exw-Jalna.
  
  
• Trade discount given by Raipur based heavy structure manufacturers is at INR 900-1,200/t and the trade price of 200 Angle is at INR 37,800-38,200/t exw.
  
  
• Trade discounts in Raipur wire rod is currently around at INR 1,000-1,200/t and trade reference prices stood at INR 34,100-34,500/t exw Raipur, INR 34,000-34,500/t Durgapur, size 5.5 mm.
  
  

Finished Flats

Indian HRC and CRC markets exhibited mixed market sentiments this week. Prices in northern India moved up on tight material availability, but market sentiments softened in eastern and western India.On the other hand Indian govt owned - SAIL announced 2nd price hike this month by INR 500-1,000/t.

SteelMint price assessments of key trade markets

• HRC (IS 2062, 2.5-8 mm) prices are assessed at INR 42,500-43,000/t (exy Mumbai),INR 44,000-45,000 (exy Delhi) while INR 43,500-44,500/t (exy Chennai).
  
  
• CRC (0.9 mm IS513 GR) are currently seen at INR 53,000-53,500/t (exy Mumbai),INR 53,000-54,000/t (exy Delhi) andINR 53,500-54,500/t (exy Chennai).
  
  
• Prices do not include GST extra @18%.
  
  

Trade participants shared with SteelMint that mills have shifted their interest to domestic sales and try easing out supplies in the coming month. This may soften prices in the near term.

Reference Prices as on 24th Oct'20 (Week 43)
Prices are exw & exclusive of GST

Indian export reference prices as on 24th Oct'20
Prices in $/t
Source: SteelMint Research