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Weekly: Indian steel market snapshot

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Semi Finished

BigMint Bureau

1907 Reads

6 Mar 2021, 16:54 IST

Indian secondary steel market has observed a volatility in prices during the week 10.
As per the assessment, Indian semi finished market was volatile due to subdued demand & the billet prices fluctuated by INR 200-800/t, In line with it, sponge prices fluctuated by INR 100-400/t, w-o-w.

Also, rebar market has observed a mixed trend as prices have decreased by INR 100-500/t in North & Central regions, whereas, prices increased by up to INR 1,500/t in Western, Eastern and Southern regions.

In context to finished flat, most of the steel manufacturers have announced price correction in HRC and CRC by INR 1,000-1,500/t for Mar'21 deliveries.

Iron Ore and Pellet

Odisha - India's largest iron ore producing state produced 12.05 mn t in Jan'21, up marginally as against 11.86 mn t in Dec'20, according to the provisional data of the Odisha Govt. maintained by SteelMint. The figures include - fines, lumps and concentrate.
SAIL's iron ore sales at periodic e-auctions in Feb'21 reversed down to 576,000 t against 700,000 t in Jan'21 and nearly 750,000 t in Dec'20. Total iron ore sales at auctions since May'20 stands at a little over 3.97 mn t, as per SteelMint data.
JSW Steel is going to re-auction 600,000 t low grade (Fe 55-58%) iron ore fines from its Jajang mines, Odisha. The auction is scheduled for 10 Mar'21 and the base price of the auction is reduced to INR 1,100/t (inclusive of Royalty).
KIOCL on 2nd Mar'21 concluded domestic sale tender of 50,000 t pellets (Fe 64% and 2% Al) at INR 12,800-13,000/t FoB Mangalore, SteelMint gathered from sources. The miner also concluded KIOCL an export deal for 55,000 t pellets (Fe 64% and 2% Al) at $192/t FoB, which is up by $2/t against its bid price of Feb export deal.
Karnataka iron ore e-auction sales volume remained largely stable in Feb'21. The allotted iron ore quantity was 2.26 mn t in Feb'21 compared to 2.2 mn t Jan'21, as per data maintained with SteelMint.
SteelMint's bi-weekly domestic pellet index "PELLEX" has increased sharply by INR 400/t to INR 12,150/t, DAP Raipur owing to hike in offers by pellet makers.
SteelMint's weekly low-grade Indian iron ore fines (Fe 57%) export index up by $1/t w-o-w to $99/t FoB east coast India.
SteelMint's weekly pellet export index (FOB east coast India) for Fe 64% grade has increased by $5/t w-o-w to $185/t.

Coal

Australian premium hard coking coal prices in FoB markets decreased marginally this week, on subdued demand with buyers waiting on the sidelines being cautious amid high volatility. Australian coking coal prices are expected to remain under continued pressure from oversupply until the Chinese import ban is lifted. The price gap between offers and bids has presently widened after buyers lowered their bid levels in view of negative short-term sentiment in ex-Chinese markets.

Lately, spot trading activity in the seaborne coking coal market has remained low due to weak buying interest from most end-users in India among other Asian importers. Indian steel mills and coke producers are showing no urgency to procure seaborne coking coal because most of them have already secured cargoes earlier.

Latest offers for the Premium HCC grade are assessed at around $122.00/t FOB Australia, $220.00/t CNF China and $144.20/t CNF India.

Ferrous Scrap

Imported scrap trades in India remained slow for yet another week. Buyers continued to remain on side-lines and preferred to go with domestic substitutes of domestic scrap & sponge iron. There is no demand from Indian buyers for imported scrap at ongoing offers. However, with Turkish prices moving up by $5 w-o-w, offers have remained on the higher side, SteelMint learned from trade sources.

SteelMint's assessment for containerised shredded of UK/US origin remains unchanged at $470/t CFR Nhava Sheva level. However, no trades were reported.
A Gujarat-based steel maker booked around 4,000 t of Dubai HMS 1 at $420/t CFR towards the closing of last week. HMS 1 from UAE is now being offered at $430-435/t CFR level.

Ferro Alloys

Silico manganese prices increased due to high demand and lower inventory of silico manganese with steel producers. There is supply shrinkage in the domestic market as most producers are either catering to government orders or exports in line with better international prices.
Ferro manganese prices increased amidst bullish export market sentiments. Meanwhile, there is only a handful of ferro manganese producers active in the domestic market. Current offers are at around INR 74,000-75,000/t exw (HC 70%).
Indian ferro chrome prices increased by INR 3,500/t to INR 102,500/t as most sellers are holding back offers in an anticipation of an increase in prices. Meanwhile, most of the producers await the next OMC chrome ore auctions.
Ferro silicon prices in Bhutan fell amidst increasing selling pressure on the producers before the financial year-end. Meanwhile, Guwahati remain firm at their offers amidst lower production owing to power curtailments, and upcoming major procurement tenders.

Semi Finished

On weekly basis, Indian Semi finished (billet) steel market observed volatility in prices on account of subdued demand & the prices volatile by INR 100-900/t, similarly sponge offers fluctuated by INR 100-400/t, w-o-w.

SAIL conducted an auction on 5th Mar for 8,500 t (steel grade) pig iron from its Rourkela Steel Plant & the entire quantity booked at a weighted average price of INR 35,550/t exw.
Indian state-owned mill concluded an export tender of 60,000 t billets (150*150, 3SP/4SP grade) at around $540/t, FoB India.
Tata Metaliks Ltd has raised foundry grade pig iron offer by INR 800/t to INR 39,500/t ($538) exw Kharagpur, Eastern India, w.e.f. 2nd Mar.
Vedanta Resources has increased foundry pig iron offer by INR 2,300/t to around INR 42,000-42,300/t DAP Ahmedabad & Kolhapur w.e.f. 2nd Mar.
Induction grade billet export offers up by $15/t to around $525/t exw Durgapur (equivalent to $545-550/t CPT Nepal). However few parcels have been sold yesterday at approx $520-522/t exw, equivalent to $545/t CPT Nepal. Strengthening rupee against the US dollar has resulted in surge in export offers.
Indian sponge iron export offers slightly up by $5/t to around $390-395/t CPT Benapole (equivalent to $410/t CFR Chittagong, Bangladesh), however few deals reported at around $390/t on CPT basis.
Steel grade pig iron prices fluctuated by INR 200-500/t across markets except in Raipur, Raigarh & Rourkela, where prices surged up to INR 1,600/t due to hike in bid price in SAIL pig iron auction.

Finished Long

India's finish long steel via induction route this week observed a mixed trend in terms of prices. In North & Central regions rebar prices decreased by INR 100-500/t w-o-w, while the same in Western, Eastern and Southern regions (except Hyderabad market) prices increased by up to INR 1,500/t due to sellers are not willing to reduce their offers because they have adequate future booking orders in hand and rising raw material cost (melting scrap) supported them to kept their offers high in the market.

Trade reference rebar prices of 10-25 mm through midsized mills assessed at INR 42,000-42,400/t exw Raipur, INR 46,600-47,000/t exw Jalna.
Trade discount given by Raipur based heavy structural steel manufacturers is at INR 1,000-1,300/t and trade reference price of 200 mm Angle is stood at INR 44,600-45,000/t exw Raipur.
Trade discounts in Raipur wire rod are currently at INR 1,800-2,200/t and trade reference prices stood at INR 41,000-41,500/t exw Raipur & INR 41,600-41,800/t exw Durgapur, size 5.5 mm.

Finished Flat

Major Indian steel manufacturers have announced price correction in list prices of HRC and CRC by INR 1,000-1,500/t for Mar'21 deliveries on dull buying interest and subdued demand in the domestic market. However major Indian steel players have shifted their interest to exports to offset bearish sales in the domestic market.

Effective prices of HRC stood at INR 54,000-54,500/t and CRC prices at INR 64,000-64,500/t. Meanwhile Govt-owned SAIL is offering a rebate on HRC for the MOU holders of about INR 1,500/t on Feb '21 price deliveries. Along with this, the participants honoring the MoU quantities for Feb and Mar '21 deliveries shall receive an additional discount of INR 2,000/t.