Weekly round-up: Semi-finished market remains volatile, Flats continue to fall

The domestic steel market saw seesaw trend in prices during week 19 ( 15-20 May, 2023). Semi-finished steel prices varied in the range of INR 50-900/tonne (t).

Domestic induction furnace-finished long steel offers witnessed volatility in prices. Prices varied in the range of INR 200-800/t. Trade reference prices for hot rolled coil (HRC) and cold rolled coil (CRC) noticed a downtrend with a fall of INR 100-1,000/t seen in the market.

Iron ore and pellets

• SteelMint's bi-weekly domestic pellets (Fe 63%) index, PELLEX, increased by INR 400/t to INR 9,150/tonne (t) DAP Raipur on 19 May 2023 compared to the last week. Around 16,900 t of deals were reported in this publishing window. The uptick is attributed to an active buying and trade inquiries in the sponge iron and steel markets throughout the week, bolstered by north region market sentiments.
  
  
• State-run Odisha Mining Corporation (OMC) conducted an iron ore lumps auction on 18 May, 2023. Out of 618,000 t of iron ore put up for auction, only 135,000 t, or 22% received bids. The material was booked at the base price of INR 6,150-9,500/t. At OMC's 746,000 t of iron ore fines (Fe54-64%) auction held on the same day from its Jilling mines, only 16,000 t (Fe55-58%) were booked at the base price of INR 2,500/t.
  
  
• Adhunik Metaliks Limited conducted an auction for sale of 21,000 t of iron ore fines (Fe58%) from Rourkela, Odisha, on 18 March, 2023. According to sources, the entire quantity was booked at a price of INR 2,730-2,740/t. The price is ex-plant, including royalty, DMF, and NMET.
  
  
• NMDC conducted an auction to sell 568,000 t of iron ore lumps and fines from Donimalai mines in Karnataka on 15 May, 2023. According to sources, 120,000 t of lumps (10-40 mm, Fe 61%) and 144,000 t of fines (Fe 59%) were booked at base prices of INR 3,132/t and INR 2,877/t, respectively. Prices are ex-mines, excluding royalty, DMF, and NMET.
  
  
• SteelMint's India pellet (Fe 63%, 3% Al) export index FOB east coast increased by $6/t w-o-w to $102/tonne (t) on 17 May. The rise in index was followed by a hike in global iron ore fines prices. However, active trades are yet to pick up amidst less firm bids. The export tender of 50,000 t of pellets (Fe 64%, 7% Silica & Alumina) floated by a south India-based producer was heard concluded at $108-110/t FOB.
  
  

Coal

• Australian premium hard coking coal prices have dropped by $17/t w-o-w to $225/t FOB and $239/t CNF on 20 May, 2023. Prices fell as buyers were sidelined amid falling prices this week while demand from China has not increased.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port recorded at 8900/t, down INR 800/t w-o-w.
  
  
• RB1 (6000 NAR) grade prices dropped by around 4% w-o-w to $109.6/t FOB and RB3 prices fell by 10% to $76/t FOB Richards Bay, South Africa.
  
  

Ferrous scrap

• Indian ferrous scrap market saw a continuous slowdown in terms of deals across the country due to sluggish finished steel market and sales. Some participants were cautious about fresh booking after Customs stopped clearance for the imported UAE material.
  
  
• Bulk bookings were heard concluded by major mills yet containerised market remained slow with nominal volume under 10,000 t including all grades throughout this week.
  
  
• Offers for each grade including shredded, HMS (80:20) from Europe-origin continued their uptrend as it was up by $8-10/t for Nhava Sheva.
  
  
• Market participants expected scrap prices to remain at these levels for the next few days, as there was a slight improvement in the demand-supply chain.
  
  

Ferro alloys

• According to SteelMint, prices of Indian silico manganese remained steady w-o-w on May 19, 2023. Prices were offered at INR 73,600/t ex-Durgapur, INR 74,600/t ex-Vizag, stable w-o-w, and INR 74,200/t ex-Raipur, stable w-o-w. As steel demand has slowly decreased, relieving some of the limitations on industrial inventory, the spot market has remained on hold, with quotations staying stable.
  
  
• As of May 19, 2023, prices of ferro manganese in India was almost constant w-o-w at INR 75,500- 76,000/t ex-Durgapur and ex-Raipur. Prices for ferro manganese remained constant as demand for special steel declined.
  
  
• According to SteelMint's assessment on 18 May, Indian smelters concluded transactions of around 2,000 t for HC60% grade at around INR 108,000-110,000/t exw. Producers have begun to quote offers which are slightly higher than last week's average offers, although deals have not yet been finalised. Indian ferro chrome prices increased by INR 1,700/t ($21) w-o-w due to improved inquiries in domestic and overseas markets and high production costs.
  
  
• Furthermore, bids for high quality chrome ore at OMC's auction reached up to a 12% premium above the base price. Out of the 85,100 t placed up for sale, 55,700 t received bids, showing that purchasers were engaged amid hopes that ferro chrome prices would rise shortly.
  
  
• According to SteelMint's assessment on 19 May, Guwahati-based producers were offering at around INR 122,000-123,500/t exw, while offers in Bhutan were hovering at INR 123,000/t exw. Due to low demand, Indian ferro silicon (70%) prices declined by INR 700/t this week. Prices continued to fall despite higher production costs in the north eastern belt.
  
  

Semi-finished

• The semi-finished steel market has experienced price volatility recently due to moderate demand, leading to fluctuations in prices for offers from mid-sized mills. In some key locations, domestic billet prices have increased by INR 50-500/t in a week of trading. The Hyderabad and Ahmedabad markets have seen a significant price rise, while prices in other key locations have dropped by INR 100-900/t. Mumbai witnessed a major price decrease.
  
  
• Sponge iron offers, on the other hand, rose by INR 500-700/t w-o-w in some key areas, except for Durgapur and Ramgarh, where there was a drop of INR 550-700/t w-o-w.
  
  
• Rourkela Steel Plant (RSP) conducted an auction for 4,000 t of steel grade pig iron on May 19, 2023. Approximately 2,950 t was booked at an average price of INR 41,120/t exw (ex-works).
  
  
• Tata Metaliks has increased prices of basic-grade pig iron by INR 500/t ($6/t) due to high demand and supply shortages. The current offers for Si 1.0-1.5% material stand at INR 44,700/t exw-Kharagpur. Neelachal Ispat Nigam Ltd (NINL) in Odisha concluded a steel grade pig iron auction of 5,000 t on May 12, 2023. The entire quantity was booked at an average price of INR 41,200/t exw.
  
  

Finished long

• India's induction furnace route-finished long steel market remained volatile throughout the week. Prices moved in an upward direction in the first half of the week owing to a shortage of scrap due to Customs clearance in the key markets. Buying activities in the finished segment were initially moderate but slowed down later which ultimately led to a minor fall in prices. Market participants said that due to lack of clarity in the current trend, fluctuation in rates can be observed in the near term.
  
  
• In rebar, steel prices decreased by INR 200-600/t across regions w-o-w except northern region and some markets like Ahmedabad and Raipur which have seen a hike of INR 500-800/t, as per SteelMint's assessment.
  
  
• The trade reference price of Fe 500 grade rebar manufactured via the IF route for 10-25 mm size was assessed at INR 47,800-48,200/t exw Raipur, INR 53,000-53,500/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150 mm channel stands at INR 50,000-50,200/t exw Raipur. Around 7,500 t of deals recorded in steel wire rod (5.5 mm, SWRY 14) in Raipur market. Currently, prices of wire rod are hovering around at INR 47,800-48,500/t ex Raipur.
  
  
• Trade level prices of rebars made through blast furnace route continued to show downtrend in major markets. Market sentiments remained bearish as buyers are procuring on an urgent basis only and have moved to sidelines. Furthermore, an anticipation of price fall in the near term has resulted in the cautious buying in the market.
  
  
• Rebar offers in the project segment were heard around INR 55,000-56,000/t, FOR Mumbai. Demand from this segment is improving slightly as pre-monsoon sourcing is picking up. SteelMint's weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) for the trade segment fell by INR 1,000/t w-o-w to INR 56,400/t, exy-Mumbai, excluding GST at 18%.
  
  

Finished flat

• Trade level prices of flat steel products continued to move down this week. The trade prices of HRC and CRC dropped this week to INR 56,500-57,500/t and INR 62,000-63,000/t respectively. Prices mentioned are on exy-Mumbai, excluding GST at 18%. Lacklustre buying interest in the traders' market, continued to weigh on prices.
  
  
• Meanwhile, market sentiments remained mixed, as some distributors opined that demand to start improving while others stay concerned about the revival ahead of monsoons. Availability of cheaper imported HRCs is another alarm raiser for the domestic traders.
  
  
• On the exports front, weekly assessed Indian mill HRC offers stood firm for the Middle East market at $630/t CFR UAE. However, offers dropped for the European region to $690-700/t (down by $50/t w-o-w).
  
  
• SteelMint's India HRC (SAE1006) export index, that reflects offers to Middle East and Vietnam were assessed at $595/t FOB east coast this week, unchanged w-o-w. Cheaper alternatives available for buyers in the Middle East and no offers to Vietnam amid sluggish domestic demand remained points of concerns.