Weekly round-up: Longs market witnesses positive trends, flat steel trade prices edge up

The domestic steel market saw a recovery in sentiments during week 41 (3 Oct- 8 Oct'22). Semi-finished steel prices rose in the range of INR 100-750/tonne (t).

Domestic induction furnace finished long steel prices witnessed positive trends, with offers surging INR 1,000/t w-o-w. Trade reference prices for finished flats increase in the range of INR 100-1,000/t for HRC and CRC.

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 8,300/tonne (t) DAP Raipur, stable compared to the last assessment on 4 October, 2022. No deal was reported.
  
  
• India's largest merchant iron ore mining company, NMDC, has kept iron ore prices unchanged for October 2022 deliveries, SteelMint learnt from sources. NMDC fixed prices for lump iron ore (65.5%, 6-40mm) at INR 4,100/t, DR CLO (Fe 67%, 10-40mm) at INR 4,920/t and iron fines (64% - 10mm) at INR 2,910/t (FoR prices, excluding royalty, DMF and NMET) with effect from today.
  
  
• Vedanta conducted an auction on 7 October for 48,000 t of iron ore lumps (Fe60.5-61.5%) from A. Narrain mines in Karnataka's Chitradurga district. The entire quantity of around 48,000 t of lumps was booked at a price of around INR 4,651-4719/t, higher than nearly INR 600/t against the price of INR 4,069-4,111/t. Prices exclude royalty, DMF, and NMET.
  
  

Coal

• Australian hard coking coal prices rose by $3/t w-o-w to $274/t FOB and $295/t CNF India. The Indian steel market is yet to see full recovery in restocking demand and supply disruptions from major Canadian miner provided support to coking coal prices.
  
  
• Portside RB3 (4800 NAR) prices rose by INR 600/t w-o-w to INR 14,300/t at Vizag Port amid rising demand from sponge iron manufacturers.
  
  
• South African RB1 (6000 NAR) prices fell by $60/t w-o-w to $254/t FOB as daily enquiries from Europe fell amid high coal inventory levels. The onset of autumn has eased power demand in Europe, while winter inventory of coal and gas are sufficient for the initial days.
  
  

Ferrous scrap

• India's containerised scrap market remained silent due to festivals throughout the week, as major markets remained inactive. Mini mills are booking hand to mouth and are waiting to understand market trends better. Buyers are actively procuring bulk scrap vessels due to cost competitiveness.
  
  
• Meanwhile, the UAE's Ministry of Economy issued a notice recently stating that the temporary ban on steel scrap and waste paper exports has been extended until 19 March. The ban has been extended to strengthen the country's domestic demand, which has impacted active scrap booking from Dubai suppliers.
  
  
• SteelMint's assessment of shredded scrap in India stood at $455-460/t CFR Nhava Sheva, up by $6/t w-o-w
  
  

Ferro alloys

• In SteelMint's assessment on 7 October, Indian silico manganese (60-14) prices were rangebound w-o-w at INR 71,500/t ex-Durgapur, INR 72,000/t ex-Vizag, and INR 72,400/t ex-Raipur w-o-w. As a result of low domestic demand, silico manganese prices continued to rangebound, causing many mills to reduce production in order to recoup their production costs.
  
  
• As on 7 October, Indian ferro manganese (HC70%) prices were rangebound w-o-w at INR 74,000/t ex-Durgapur and ex-Raipur at INR 74,000/t. Special steels and stainless steels saw limited demand. Hence, ferro manganese prices remained rangebound.
  
  
• According to SteelMint assessment on 6 October, ferro chrome producers were offering HC60% grade at around INR 96,000-97,000/t on exw basis in Odisha. Buyers were not interested in booking material due to holidays while some were waiting for Vedanta's ferro chrome auction.
  
  
• Ferro silicon (70%) prices fell as the market witnessed moderate demand as some buyers were in a wait-and-watch mode on expectations of further price drop. According to SteelMint's assessment on 7 October, Bhutan's producers were offering at INR 135,000/t and Guwahati followed the trend.
  
  

Semi finished

• Indian semi-finished steel prices increased w-o-w, with domestic billet prices rising by INR 100-700/t across regions, with the major increase of INR 700/t in Ahmedabad. Similarly, sponge iron prices increased by INR 100-750/t w-o-w.
  
  
• Vedanta Resources reduced foundry grade pig iron prices by INR 500/t ($6/t) for Maharashtra-based buyers. Current offers stand at INR 53,500/t DAP Kolhapur.
  
  
• Neelachal Ispat Nigam Ltd (NINL) has started operations nearly 90 days after it was acquired by Tata Steel for INR 12,100 crore.
  
  
• Vizag Steel floated an ocean sale export tender for 30,000 t of steel blooms (150x150mm, 3SP/4SP) on FOB ST. delivery basis against 100% payment terms. The due date of the tender is 10 October.
  
  
• SteelMint's weekly price assessment remains firm at $450/t CPT Nepal, (FeM 80%, lumps 70%, fines 30%). No fresh deal was reported for Nepal this week due to Durga Puja and Dussehra amid LC opening concerns.
  
  

Finished long

India's induction furnace finished long steel market this week observed moderate buying enquiries amidst festive holidays. Bulk trades were affected and buyers were cautiously procuring material only to meet immediate requirements. On the other hand, manufacturers adjusted trade offers and prices for rebar, wire rod, and structure steel in view of sales pressure and raw material price movements, which fluctuated on daily basis in key markets.

On a weekly basis, prices of rebar steel exhibited mixed trends. In most markets prices increased by up to INR 1,000/t w-o-w, while in a few others prices remained stable or declined marginally by 100-200/t, SteelMint 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 52,000-52,400/t exw Raipur and INR 55,000-55,500/t exw Jalna.
  
  
• Trade discounts given by Raipur-based heavy structural steel manufacturers stood at around INR 1,500-1,700/t and the trade reference price of 200 mm angle stood at INR 57,800-58,200/t exw Raipur.
  
  
• Trade discounts given by Raipur-based steel wire rod suppliers stood at around INR 500-800/t and the trade reference price was assessed at INR 52,600-53,000/t exw Raipur and INR 52,100-52,500/t exw Durgapur for size 5.5 mm.
  
  
• Trade prices of rebar continued to increase amid moderate demand even during the festive holidays and heavy downpour in the north-west provinces this week.
  
  
• Also, in the preceding week, Indian mills had increased the list prices of BF-origin rebar by INR 1,000/t for early-October sales, which gave a boost to trade prices. Moreover, participants in the distribution network continued to maintain inventories at moderate levels, anticipating slow trade momentum ahead of Diwali and concerns around weather conditions. Thus, prices stayed buoyant amid limited availability in the distribution channel.
  
  
• SteelMint's weekly price of rebar (12-32mm, BF-origin, IS 1786, Fe500D) increased by INR 700/t at around INR 56,000-57,000/t on exy-Mumbai basis, excluding GST at 18%.
  
  

Finished flat

• Trade-level prices of finished flat steel products remained firm w-o-w, even witnessing an increase in some markets.
  
  
• Mills raised their list prices of HRC, CRC by INR 1,000/t, and for HR plate by INR 1,000-1,500 for early-October sales. For coated steel products, prices varied between INR 750-1,000/t. An increase in restocking activities since mid-September allowed mills to adjust their price levels with those prevailing at the trade level.
  
  
• Moreover, mills are gradually resuming operations after phased maintenance shutdowns, while there is slow improvement in capacity utilisation. This has provided support to trade-level prices amid supply disruptions for some products amid steady sales momentum over the past few weeks. Furthermore, end-users are focusing more on essential spending this festive season whuch usually provide better sales opportunities to automotive and white goods industries. The drive for essential spending was recorded 0.9 percentage points higher in September at 77.3% compared with the 76.4% recorded in July, as per a survey conducted by Reserve Bank of India (RBI). This, in turn, hints at improved demand from the industries.
  
  
• On the exports front, mills floated offers at $620-630/t CFR Vietnam, $630-640/t CFR UAE and $670-690/t CFR Europe, but no bookings were heard of late. Mills are are seeking to cater to the domestic maerket amid better realisations. SteelMint's India HRC export index was pegged to $583/t FOB east coast for the fourth consecutive week.