Weekly round-up: Indian flat steel prices dropped, semis remain volatile

The domestic steel market witnessed fluctuation in prices during week 30 (22-27 July). Semi-finished steel prices varied in the range of INR 50-1,250/tonne (t).

Iron ore and pellet

• BigMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, dropped by INR 150/t w-o-w to INR 8,900/tonne (t) DAP Raipur on 26 July. Around 135,000 pellet deals (Fe63%) were recorded in the Raipur region this week after the price reduction by pellet producers. Raipur-based pellet makers have cut their pellet offers for Fe 63%(+/-0.5%) by INR 300-400/t ($4-5/t) to INR 8,800-8,900/t ($105-106/t) exw.
  
  
• OMC conducted an auction for 2.5 mnt of iron ore (1.485 mn fines and 1.057 mnt lumps, Fe 58-64%) on 20 Jul'24. The buyers booked the 1.485 mnt of fines and 0.953 mnt of lumps at INR 2,470-4800/t and 3,770-6,000/t respectively. The bids (weighted average) remained largely stable in the July auction compared to last month.
  
  
• In NMDC's auction for 252,000 t of iron ore from its Kumaraswamy mines on 20 Jul'24 the following quantities were booked: 128,000 t lumps (10-40 mm, Fe 61.34-63.34%) at INR 4,705-5,309/t against base price of INR 4,588-5,039/t and 124,000 t fines (Fe 58-62.74%) at INR 3,659-4,171/t against base price of INR 3,249-4,161/t ex-mines, including royalty, DMF and NMET. Bid prices rose by INR 270/t and INR 420/t for lump and fines.
  
  
• Asia-Pacific Supramax dry bulk (50,000-55,000 t) freight rates for an iron ore vessel from the east coast of India to China fell by $0.6/tonnes (t) w-o-w to $12.8/t on 24 July. The freight rate for Supramax has declined to an eight-month low, as per data maintained with BigMint. The sluggish demand from China has impacted vessel movements and the decline in iron ore cargoes has kept freights under pressure.
  
  

Coal

• Australian premium hard coking coal prices fell by 5% w-o-w to $218/t FOB and $234.35/ t CNF on 26 July. The continued material oversupply weekend market sentiments.
  
  
• RB1 (6000 NAR) grade coal prices edged up by $1/t w-o-w to $106/t FOB. Also, RB3 prices also picked up by $1/t to $74/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port remained largely stable at INR 7,700/t.
  
  

Ferro Scrap

• This week, India's imported scrap market saw a marked decrease in activity due to a significant price disparity between suppliers' offers and buyers' bids, resulting in almost no trades. Both buyers and suppliers were at an impasse, with the latter ceasing offers to India in favor of more lucrative domestic markets in the UK and Europe. The domestic steel market's slowdown and ongoing volatility further dampened demand.
  
  
• The announcement of the FY24-25 budget, which maintained nil import duties on ferrous scrap, did little to revive interest. The bid-offer gap remained wide, with buyers finding current import price levels unviable compared to domestic scrap, which was more cost-effective. The gap between imported and domestic scrap prices was around INR 3,000-3,500/t, pushing buyers towards more affordable domestic scrap.
  
  
• Reports from various trading representatives highlighted the poor market conditions and lack of significant buying activity. Despite some inquiries, particularly from regions like Gujarat, there were no suppliers willing to meet the buyers' desired prices. This week underscored the preference for domestic scrap and the ongoing challenges in aligning international scrap prices with local market realities.
  
  
• Weekly average offers for shredded scrap from the UK/Europe were assessed at $414/t CFR Nhava Sheva, while HMS 80:20 at $387/t CFR, down by $1/t and $2/t respectively.
  
  

Ferro Alloys

• Silico Manganese:Silico manganese prices in India dropped w-o-w by INR 1,000/t ($12/t) to INR 68,200-68,800/t ($814-822/t) exw across markets (Raipur, Durgapur and Vishakhapatnam). Steel mills are adopting a cautious approach to procurement, opting for need-based purchases amidst expectations of further price declines.
  
  
• Ferro manganese:Ferro manganese (HC70%) prices persisted downtrend w-o-w by INR 2,100/t ($25/t) in Raipur, reaching INR 75,600/t ($903/t) exw. Meanwhile, in Durgapur, prices diminished by INR 1,800/t ($21/t) w-o-w to INR 75,200/t ($898/t). Prices continued to decline on the lower side as the market remained slow with its trades and only need-based purchases took place.
  
  
• Ferro Silicon: Indian ferro silicon (FeSi:70%) prices remained static w-o-w, settling at INR 92,000/t ($1,099/t) exw-Guwahati on 26 July. However, Bhutan's prices fell by INR 400/t ($5/t), reaching INR 92,700/t ($1,107/t) exw. Variations in bids and offers continued to weigh on the ferro silicon market although no significant drop in trade prices have been reported.
  
  
• Ferro chrome:Prices of Indian high-carbon ferro chrome (HC60%, Si:4%) dropped by INR 1,400/t ($17/t) on 26 July, settling at INR 107,200/t ($1,280/t) exw-Jajpur. Prices dropped as market conditions remained subdued and bid prices also dropped m-o-m in OMC's chrome ore auction.
  
  

Semi Finished

• Indian semi-finished steel prices decreases as per BigMint's assessment. Domestic billet prices in almost all key locations decreased by INR 50-1,250/t across regions, with a major decrease of INR 1,250/t seen in the Goa market. However, billet prices only in the Ahmedabad market showed a marginal rise by INR 100/t. Similarly, sponge iron prices also decreased in almost all key locations by INR 100-600/t, with a major decrease of INR 600/t seen in the Ramgarh market. However, sponge iron prices only in the Rourkela market witness a slight uptick by INR 150/t.
  
  
• SAIL-Durgapur Steel Plant (DSP) held an auction for 2,500 t of steel-grade pig iron on 23 Jul'24. The entire quantity was booked at an average price of INR 36,700/t exw.
  
  
• Indian DRI (Direct Reduced Iron) export offers decreased by approximately $7-10/t, reaching $348/t on CPT Raxaul, and $355/t on CPT Benapole.
  
  

Finished Long Steel

• IF-rebar:India's induction furnace route finished long steel prices observed 3.5 year low level, previously, the current price levels were seen in Feb'21. Limited trades were observed this week as buyers resorted to need-based material procurement amid declining price trend. However. towards the end of the week, moderate bookings were reported in the Western (Maharashtra) region post drop in list price announced by mills by INR 2,000/t. Meanwhile, in other parts of the country, trading activities continued to remain subdued. This has also pushed sellers to operate at lower production levels owing to higher inventory of around 12-15 days which varies from region-to-region. As per the participants, prices are likely to remain range-bound in the near-term. However, buying interest in the coming week would be the deciding factor for the trend.
  
  
• On a weekly basis, in rebar steel prices witnessed declined by upto INR 1,800/t across the regions as per BigMint assessment shows.
  
  
• The trade reference price of Fe 500 grade rebar manufactured via the IF route for 10-25 mm size was assessed at INR 41,300-41,700/t exw Raipur, INR 44,500-45,100/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150mm channel stands at INR 44,600-45,100/t exw Raipur.
  
  
• Trade reference prices of wire rod hovering at INR 42,700-43,100/t ex Raipur.
  
  
• BF-rebar:Trade-level blast furnace (BF) rebar prices fell by INR 600-1,400/t w-o-w amid subdued buying across markets. Buyers were away from market amid price volatility, weak sentiments and participants in distribution channel continued to destock inventories as prices have fallen continuously from past couple of weeks.
  
  
• Current week's rebar prices (12-32mm) in the trade segment dropped by INR 600/t w-o-w to INR 51,700/t exy-Mumbai. Prices are exclusive of GST at 18%.
  
  
• In the projects segment, prices are hovering in the range of INR 50,000-50,500/t FOR Mumbai basis, down by INR 1,000/t against preceding week's levels amid limited buying inquiries from end-users.
  
  

Finished flate steel

• Hot-rolled coil (HRC) prices in India have decreased by up to INR 600/t, settling between INR 51,000-54,400/t. Cold-rolled coil (CRC) prices have also dropped by up to INR 600/t, reaching a range of INR 57,000-63,000/t. The market is slow due to limited demand, with buyers negotiating for lower prices and purchasing smaller quantities.
  
  
• India's bulk HRC and plate imports are surging, according to vessel line-up data compiled by BigMint. Imports are 3,49,113 till 22 July 2024 with an estimated additional 3,50,849 tonnes (t) expected to arrive by end July 2024
  
  
• Indian steel mills are focusing on domestic sales of HRC and refraining from exporting due to competitive global prices and subdued global demand.