Weekly round-up: Semi-finished prices decline further amid weak demand ahead of festive season

Domestic induction furnace finished long steel offers witnessed a downtrend. Prices dropped by INR 800-2,000/tonne (t). Trade reference prices for hot rolled coils (HRCs) and cold rolled coils (CRCs) fell by INR 300-500/t. Overall, semi-finished steel prices witnessed a further decline.

Iron ore and pellets

• NMDC raised prices of CLO and fines by INR 700/t ($8) and INR 400/t ($5) respectively, effective from 23 October. The company set the prices of DR CLO (10-40mm, Fe67%) at INR 7,420/t ($88/t) and iron ore fines (-10mm, Fe64%) at INR 5,410/t ($64/t) on FOR basis from its Bacheli complex.
  
  
• BigMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, rose by INR 500/t w-o-w to INR 10,500/t DAP Raipur on 25 October. Raipur-based pellet makers raised their offers for iron ore Fe 63% (+/_0.5%) on 21 October by INR 500/t ($6/t) to INR 10,400-10,500/t ($124-125/t) exw, following a corresponding hike by Odisha-based producers. Trades remained muted this week due to bid-offers disparities amid a sharp fall in sponge PDRI prices ahead of the Diwali festival.
  
  
• BigMint's bi-weekly Indian low-grade iron ore fines (Fe 57%) export index remained stable w-o-w at $60/t FOB east coast on 24 October, with no deals reported in this period. The discount level widened to this week at 20-25% on the global fines index. India pellet (Fe 63%, 3% Al) export index (FOB east coast) remained stable w-o-w at $94/t on 25 October.
  
  
• Asia-Pacific Supramax dry bulk freights (50,000-55,000 t) for iron ore shipments from the east coast of India to China dropped by $0.1/t w-o-w to $12.9/t on 23 October. Limited tonnage was observed due to declining demand from China, which kept rates under pressure. The drop in demand in China stemmed from market uncertainty, as participants held off from deals, waiting to see the impact of the stimulus package.
  
  

Coal

• Australian coking coal prices fell marginally on a weekly basis to $199/t FOB Australia.
  
  
• RB1 (6000 NAR) grade coal prices remained largely stable w-o-w at $102/t FOB. RB3 prices remained unchanged at $70/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port remained unchanged at INR 7,600/t.
  
  

Ferro scrap

• India's demand for imported scrap remined subdued, primarily due to a bid-offer mismatch and a slowdown in the domestic steel market. Disruptions from a cyclone in some regions, along with the approaching Diwali festival, further dampened demand.
  
  
• Offers for shredded scrap from the US and UK/Europe remained at $395-400/t CFR Nhava Sheva, while HMS (80:20) was assessed at $370-385/t. However, buyers expected lower prices.
  
  
• Market participants said, "The festive season and competition from Turkish buyers for European scrap contributed to the cautious sentiment in the market. With widening bid-offer gaps and misaligned expectations between buyers and sellers, the market was anticipated to remain soft in the coming weeks, leading to uncertainty around future demand and pricing."
  
  
• In all, around 9,000-10,000 t of scrap were booked this week.This included approximately 2,500 t of shredded from the US and UK/EU at $392-395/t CFR, with the balance comprising of HMS (80:20), blue steel, cast iron scrap, Cr busheling, and fabrication.
  
  

Ferro alloys

• Silico manganese: Indian silico manganese prices declined this week as steel mills, dealing with weak demand, approached procurement more cautiously. Notably, tags for the 60-14 grade drifted down by INR 950/t ($11t) w-o-w to INR 66,900-68,200/t ($796-811/t) exw in Raipur, Durgapur, and Visakhapatnam. The slowdown in silico manganese was also compounded by market uncertainty and limited export demand.
  
  
• Ferro manganese: Indian ferro manganese (HC70%) prices declined by around INR 1,800/t ($21/t) w-o-w to INR 69,200/t ($823/t) exw in Raipur and by INR 2,000/t ($24/t) w-o-w to INR 69,000/t ($821/t) in Durgapur. The market response remained muted towards the higher quotes due to which prices dropped this week.
  
  
• Ferro silicon: Indian ferro silicon (FeSi: 70%) prices declined by around INR 1,300/t ($16/t) w-o-w to INR 107,300/t ($1,276/t) exw-Guwahati on 25 October. Meanwhile, prices in Bhutan dropped by INR 900/t ($11/t) to INR 107,100/t ($1,274/t) exw. Prices dropped as there was a bit of resistance towards higher offers which were being quoted earlier when Meghalaya plants were still under suspension. Thus, some buyer-seller negotiations led to the price drop. Additionally, the Meghalaya State Electricity Regulatory Commission (MSERC) proposed a tariff hike for ferro alloys industries, raising rates by INR 1.47/kVah to INR 6.47/kVah, which may potentially impact ferro silicon prices soon.
  
  
• Ferro chrome: Prices of Indian high-carbon ferro chrome (HC60%, Si:4%) remained largely stable inching up by INR 150/t ($2/t) w-o-w to INR 110,550/t ($1,315/t) exw-Jajpur on 25 October. Prices were steady as bid-offer disparities prevailed. Following the latest auction from the Odisha Mining Corporation (OMC), offers were raised by most suppliers, but these faced resistance from buyers.
  
  

Semi-finished

• Indian semi-finished steel prices showed a downtrend as per BigMint's assessment. Domestic billet prices in almost all key locations decreased by INR 1,350-2,500/t across regions, with a major decrease of INR 1,700/t seen in the Goa market. Also, sponge iron prices declined in almost all key locations by INR 700-1,700/t, with a major decrease of INR 1,700/t seen in the Rourkela, Raigarh and Ramgarh markets.
  
  
• On 24 October, NMDC's Nagarnar steel plant conducted an auction for 30,000 t of steel-grade pig iron at a base price of INR 36,000/t. However, no bids were received due to weak finished steel demand and low viability. In contrast, the previous auction on 17 October saw 25,000 t of the offered 32,000 t booked at an average price of INR 36,000/t.
  
  
• Indian DRI export offers decreased by $9/t CPT Raxaul to $375/t. CPT Benapole offers reduced by $17 to $380/t.
  
  

Finished long steel

• IF-rebar: India's induction furnace-route finished long steel prices edged lower w-o-w. Buying interest continued to remain weak owing to lack of clarity on the market trend. Sellers were offering attractive discounts to liquidate material. However, buyers remained cautious and opted for wait-and-watch approach. Liquidity issue and a festive environment in the market are further adding on to the current scenario. Suppliers also reported rising inventory pressure across some regions as current inventory levels are higher than the average 8-10 days. As per sources, a similar trend may continue in the near term as Diwali approaches. Thus, limited procurement of material is expected.
  
  
• On a weekly basis, rebar prices decreased by INR 800-2,000/t across regions, as per BigMint's assessment.
  
  

• The trade reference price of Fe 500 grade rebar of 10-25 mm size, manufactured via the IF route, was assessed at INR 42,600-43,000/t exw-Raipur, and at INR 47,000-47,600/t exw Jalna.
  
  
  

• Trade reference price of heavy structural steel channel of base size 150mm stood at INR 45,200-45,600/t exw-Raipur.
  
  
  

• Trade reference prices of wire rods hovered at INR 42,800-43,300/t ex-Raipur.
  
  
  
• BF-rebar: Trade-level blast furnace (BF) rebar prices remained range-bound w-o-w across major markets. Slow buying interest weighed on sentiments. Meanwhile, shortages of material in some sizes due to maintenance shutdowns of mills, and lower inventories have kept trade prices supported this month.
  
  
• The current week's rebar prices (12-32mm) in the trade segment remained stable w-o-w at INR 54,500/t exy-Mumbai, excluding the 18% GST.
  
  
• In the project segment, prices witnessed an uptick w-o-w, hovering at INR 53,500-54,500/t FOR Mumbai. Buying interest improved with inquiries coming in as end-users started to stock up ahead of Diwali.
  
  

Flat steel

• Hot-rolled coil (HRC) prices decreased by up to INR 500/t ($6/t) this week, with current rates ranging from INR 48,300-50,000/t ($575-595/t). In contrast, cold-rolled coil (CRC) prices remained stable, maintaining a range of INR 55,700-59,100/t ($663-703/t) across various regions.
  
  
• The market for traders has been sluggish in anticipation of Diwali, characterised by low demand and purchasing activities, driven by immediate needs.
  
  
• As of 21 October, 2024, cumulative import volumes, according to BigMint's vessel line-up data, reached 528,477t, compared to 776,835t in September and 627,426t in August. An additional 35,719t are anticipated by the end of October, with another 51,260 t scheduled to arrive in the first week of November.
  
  
• Indian hot-rolled coil (HRC) exports to the Middle East and Europe remained stable w-o-w, despite competitive pricing from other major suppliers. Current offers to Europe are priced at $590-$595/t CFR Antwerp ($540 to $545 per tonne FOB east coast, India). Additionally, Indian mills have maintained their export offers to Southeast Asia.