Weekly round-up: Semi-finished prices continue to fall on bearish market sentiments

The domestic steel market saw seesaw trend in prices during week 2 ( 08-13 January, 2024). Semi-finished steel prices decreased in the range of INR 100-500/tonne (t).

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, decreased by INR 150/t w-o-w to INR 9,850/tonne (t) DAP Raipur on 12 January, 2023. A deal of 20,000 t was recorded from the Raipur region in the last one week. PELLEX dropped after bid offers disparity following the sluggish sponge market.
  
  
• NMDC Kumaraswamy sold 344,000 t of fines (Fe 57.51-63.71%) and 140,000 t of lumps (10-40 mm, Fe 61.71- 63.41%) at INR 3,006-4,198/t and INR 4,842-5,223/t against the base price of INR 3,006-4,148/t and INR 3,999- 4,332/t, respectively in the auction on 11 January. Prices are on ex-mines basis, including royalty, DMF and NMET.
  
  
• KIOCL has again suspended operations at its 3.5 mnt/year pellet plant in Mangalore w.e.f 9 Jan'24 as per the company notification released recently. The suspension was undertaken amid non-availability of iron ore fines. As reported earlier, the company resumed its operations on 19 Dec'23 after a temporary shutdown for around 15 days.
  
  
• SteelMint's weekly Indian low-grade iron ore fines (Fe 57%) export index declined by $7/tonne (t) w-o-w to $88/t FOB east coast on 11 January 2023. A 55,000 iron ore lumps (Fe 56%) deal was recorded at $115/t CFR China. Iron ore fines offers in overseas markets fell sharply this week following the sharp drop in spot and futures prices in China. The buyers remained cautious about booking material at higher offers this week.
  
  
• SteelMint's India pellet (Fe 63%, 3% Al) export (FOB east coast) index fell by $7/t w-o-w to $125/t on 10 January. The buyer's bid remained $10-15/t lowered against the seller's offers. The seaborne market facing a liquidity problem also after the drop in domestic and export steel prices in China.
  
  

Coal

• Australian premium hard coking coal prices rose by 2% w-o-w to $338/t FOB and $352/ t CNF on 13 Jan'24 amid rising demand from India.
  
  
• RB1 (6000 NAR) grade prices remained unchanged w-o-w to $99/t FOB. Similarly, RB3 prices remained stable w-o-w at $71/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port recorded at INR 8,000/t, down by INR 200/t w-o-w.
  
  

Ferro Scrap

• Throughout the week, demand for imported scrap in India remained consistently limited, as only buyers with urgent needs participated in procurement. Steel mills, uncertain about price trends and considering cost-effective materials available in the domestic market, adopted a cautious stance and refrained from active participation.
  
  
• Nevertheless, import offers from Europe experienced an increase due to limited collection and a firm seller stance. The weekly average for shredded scrap offers from Europe was assessed at $420/t CFR Nhava Sheva, marking an increase of $8/t compared to the previous week's $412/t CFR. Similarly, HMS (80:20) scraps were assessed at $400/t CFR, reflecting an increase of $8/t from the previous week's $392/t CFR.
  
  
• Approximately 1,100-1,200 t of HMS (80:20) scraps were secured from Yemen and Bahrain at prices ranging from $375/t to $400/t CFR. There were no reported bookings for shredded scrap during the week.
  
  

Ferro Alloys

• Silico manganese: In the domestic market, silico manganese prices decreased by INR 250/t exw w-o-w despite inconsistent bid offers and low demand. Pricing for silico manganese has also decreased as a result of rising port-side stockpiles exerting pressure on domestic prices. SteelMint indicated that silico manganese prices in Raipur, Vizag, and Durgapur were between INR 64,100/t and 64900/t exw.
  
  
• Ferro Manganese: Ferro manganese (HC70%) prices remained consistent week after week despite limited demand and production cuts in a key producing region. According to SteelMint, ferro manganese offers in Durgapur and Raipur on 11 January ranged from INR 64,900 to INR 65,000/t ($780-$781/t) exw.
  
  
• Ferro Silicon:Prices of Indian ferro silicon (FeSi:70%) boosts by INR 3,500/t ($42/t). The prices rose as many producers from Bhutan got their Bureau of Indian Standards (BIS) license expired due to which they withhold their offers. As a result, quotations in India went up and led to a price hike. According to SteelMint, prices of ferro silicon in India on 12 January were at INR 109,500/t ($1,321/t) exw-Guwahati.
  
  
• Ferro Chrome: On 12 January, prices of Indian ferro chrome (HC 60%, Si:4%) stayed unchanged and were at INR 112,700/t ($1,355/t) exw-Jajpur. The prices went up because the market operated with volatility as it was a need-based buying that happened in the past week. However, Stainless steel prices for the 304 grade fell by INR 2,000/t ($24/t) w-o-w and were standing at INR 173,000/t ($2,085/t) exw-Mumbai.
  
  

Semi-Finished

• Indian semi-finished steel prices decreased as per SteelMint's assessment. Domestic billet prices decreased by INR 100-500/t across regions, with a major decrease of INR 500/t seen in the Goa and Hyderabad markets. Similarly, sponge iron prices also decreased in almost all key locations by INR 100-850/t, with a major decrease of INR 850/t seen in the Bellary and Jharsuguda markets. However, sponge iron price only in Ramgarh rose slightly by INR 100/t.
  
  
• SAIL's Rourkela Steel Plant auctioned 800 t of steel-grade pig iron on 11 January, 2024. The entire material was booked at an average price of INR 37,450/t exw.
  
  
• NMDC, Nagarnar Steel Plant has extended their pig iron auction date to 17 January, 2024, which was previously scheduled for 9 Jan'24.
  
  
• Indian DRI (Direct Reduced Iron) exports offers were stable at $370/t on CPT Raxaul, and $380/t on CPT Benapole.
  
  

Finished-long steel

• IF-route rebar: India's induction furnace route finished long steel prices dipped w-o-w. The sellers reduced their offers to liquidate material but the lack of clarity about market directions compelled buyers to stay on the sidelines and procure material in the needful quantity. Participants expect such fluctuating trend to persist in the near term due to the lack of momentum in the market. It may be noted here that IF-route rebars enjoy a domestic market share of around 65-70%, as per SteelMint's assessment.
  
  
• On a weekly basis, in rebar steel prices decreased by up to INR 1,000/t across the regions as per 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 42,900-43,300/t exw Raipur, INR 47,900-48,500/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150mm channel stands at INR 46,500-46,700/t exw Raipur.
  
  
• Trade reference prices of wire rod hovering at INR 43,300-43,800/t ex Raipur.
  
  
• BF-route rebar: Trade-level prices of BF-route rebar continued to show down trend across markets owing to slow buying activities. Prices have been on downfall since 14 consecutive weeks, which has kept buyers cautious and opt for need basis procurement until prices stablise.
  
  
• In the projects segment, prices are currently hovering at INR 50,000-51,000/t on FOR Mumbai basis. Purchases continued to be based on specific needs, despite receiving inquiries from end users.
  
  
• SteelMint's weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) for the trade segment dropped by INR 200/t to INR 52,000/t, exy-Mumbai, excluding GST at 18%.
  
  

Finished flat steel

• Trade-level prices of hot-rolled coils (HRCs) and cold-rolled coils (CRCs) dropped further in the major markets, influenced by subdued trading and market sentiment shaped by more economical domestic alternatives. SteelMint's benchmark assessment for HRC (IS2062, Gr E-250, CTL, 2.5-8mm) dropped by INR 400/t to INR 53,500-54,500/t exy-Mumbai, excluding GST at 18%, as of 12 January 2023. Meanwhile, the slide in HRC prices in the markets of Chennai (down, INR 800/t) and Faridabad (down, INR 1,000/t) were much more steeper. Concurrently, the prices of CRC (IS513, Gr O, 0.9mm) also exhibited stability, remaining at INR 62,000/t during the same period. Mill attempts to raise prices proved ineffective, with a slight demand improvement at reduced price levels. Anticipation of further improvement is noted in the latter half of the month, though participants remain skeptical of any upward price movement at this juncture.
  
  
• The plate mill at the Bhilai Steel Plant is currently undergoing maintenance, leading to an anticipated loss of approximately 186,000 tonnes within the 45-day maintenance period.
  
  
• Meanwhile, the SteelMint India HRC Export Index rose to $605/t FOB on the east coast for the Middle East and Vietnam. Indian HRC exports to Europe held steady at $690-700, while domestic prices in Europe experienced an increase.