Weekly round-up: Semi-finished prices decrease amid dull finished steel demand

The domestic steel market saw dull trends in prices during week 27 (1 July-6 July, 2023). Semi-finished steel prices declined by INR 400-1,500/tonne (t).

Iron ore and pellets

• BigMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, inched down by INR 50/tonne (t) w-o-w to INR 9,550/t DAP Raipur on 5 June. Around 62,000 t of pellet (Fe62.5-63%) deals were concluded in the Raipur region where moderate trading activity was witnessed last week.
  
  
• BigMint's India pellet (Fe 63%, 3% Al) export index (FOB east coast) increased by $6.5/t w-o-w to $103.5/t on 3 July 2024. Around 300,000 t of pellet (Fe 62-63%) export deals were recorded from India at $115-121/t CFR China by the major pellet exporters in the last one week. BigMint's weekly Indian low-grade iron ore fines (Fe57%) export index increased by $5/t w-o-w to $63/t FOB east coast on 4 July. Around 110,000 t of Fe57% fines deals were recorded from India at $76-77/t CFR China in this publishing window.
  
  
• JSW Steel conducted an auction for 387,100 t of iron ore CLO (10-40 mm, Fe 55.5-62%) from its Narayanposhi, Nuagaon and Jajang mines in Odisha on 3 July. According to sources, 292,300 t of CLO got booked at INR 2,610-5,710/t against the base price of INR 2,600-5,300/t. Prices are on ex-mines/plot basis and inclusive of royalty, DMF and NMET.
  
  
• 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 rose by $0.31/t this week to $14.21/t on 3 July, as per BigMint's assessment. The requirement of large vessels was seen due to the presence of inquiries in the global market. In China, steel mills are planning to increase their finished steel production and increased iron ore demand has contributed to fixing of inquiries across key routes.
  
  

Coal

• Australian premium hard coking coal prices picked up by 9% w-o-w to $254/t FOB and $270/t CNF on 5 July on supply constraints arising due to a fire accident at an Anglo American mine.
  
  
• RB1 (6000 NAR) grade prices edged down w-o-w to $107/t FOB. Also, RB3 prices fell to $73/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port remained unchanged at INR 8,200/t.
  
  

Ferrous scrap

• This week in India, the imported scrap market saw limited activity due to several factors. Buyers hesitated due to softening steel prices, a bid-offer disparity, and prolonged delivery times from the UK, now at 45-50 days. Container shortages also posed issues. Despite good domestic scrap availability, GST raids on major dealers in southern India raised concerns about potential shortages. Offers for US and UK/Europe shredded scrap were at $410-415/t CFR Nhava Sheva, with buyers bidding at $405-408/t CFR. While there was slight improvement in the western region, the south remained uninterested due to subdued steel demand and high freight rates. By the end of the week, the market remained sluggish as buyers opted for cheaper domestic scrap, and mills faced the prospect of reducing output. Traders anticipate a potential uptick in activity after mid-July despite ongoing challenges with freight and shipping costs.
  
  

Ferro alloys

• Silico manganese: Silico manganese prices in India took a downtrend w-o-w by INR 2,550/t ($31/t) to INR 73,500-73,700/t ($880-883/t) exw across markets (Raipur, Durgapur and Vishakhapatnam). Weak demand from local steel mills, limited trade activities, production cuts and subdued export inquiries suppressed the domestic market.
  
  
• Ferro manganese: Ferro manganese (HC70%) prices decreased significantly w-o-w by INR 3,700/t ($44/t) in Raipur, reaching INR 83,400/t ($999/t) exw. Meanwhile, in Durgapur, prices shrank by INR 2,800/t ($34/t) to INR 83,500/t ($1,000/t). Prices dropped as demand weakness persisted and markets remained volatile.
  
  
• Ferro silicon: Indian ferro silicon (FeSi:70%) went down w-o-w by INR 400/t ($5/t) settling at INR 95,000/t ($1,138/t) exw-Guwahati on 1 July. Meanwhile, Bhutan's prices fell by INR 1,600/t ($19/t), reaching INR 95,000/t ($1,138/t) exw. The drop in offers followed Bhutan's new offers for July at INR 95,000/t ($1,138/t) exw.
  
  
• Ferro chrome: Prices of Indian high-carbon ferro chrome (HC60%, Si:4%) remained range-bound w-o-w with a slight decline of INR 100/t ($1/t) seen on 5 July, settling at INR 111,000/t ($1,330/t) exw-Jajpur. Prices remained firm as there was lesser acceptance of higher quotes and the overall market functioned cautiously.
  
  

Semi-finished

• Indian semi-finished steel prices decreased as per BigMint's assessment. Domestic billet prices in all key locations decreased by INR 400-1,500/t across regions, with a major decrease of INR 1,500/t seen in the Ahmedabad market. Similarly, sponge iron prices also decreased in all key locations by INR 100-1,100/t, with a major decrease of INR 1,100/t seen in the Durgapur market.
  
  
• SAIL's Rourkela Steel Plant (RSP) held an auction for 4,000 t of steel-grade pig iron on 2 July. The entire quantity was booked at an average price of INR 36,600/t exw.

  NMDC's steel plant in Nagarnar, Chhattisgarh, conducted a steel-grade pig iron auction for a total of 23,000 t on 1 July. Around 10,000 t were booked at an average price of INR 36,500/t.

  State-owned Vizag Steel (RINL) floated an ocean sale export tender for 30,000 t of pig iron (basic grade) on FOB Vizag Port/Gangavaram Port basis against 100% advance payment terms.
  
  

• Indian DRI export offers increased by approximately $3-5/t to $355/t CPT Raxaul, and $365/t CPT Benapole.
  
  

Finished longs

• Induction furnace rebar: India's induction furnace route finished long steel prices edged lower w-o-w amid subdued buying interest. Traders/buyers had procured sufficient material last week as per their requirement, post which they entered a wait-and-watch mode to gain clarity on the market direction. The sellers were offering attractive discounts to boost sales. However, movement in the spot market continued to remain slow. Also, reduction in offers announced by primary mills for early July deliveries also contributed to the current market scenario. Monsoon rainfall in many cities is another factor which has impacted buying activities which led to increase in inventories at mills .Participants are expecting a similar trend to continue in the near-term.
  
  
• On a weekly basis, rebar prices witnessed a decline in the range of INR 500-1,600/t across regions, BigMint's assessment shows.
  
  
• The trade reference price of Fe500 grade rebar manufactured via the IF route for 12-25 mm size was assessed at INR 42,700-43,100/t exw-Raipur, and at INR 46,700-47,300/t exw-Jalna.
  
  
• Trade reference prices of heavy structural steel for base size 150mm channel stands at INR 45,800-46,200/t exw-Raipur.
  
  
• Trade reference prices of wire rods hovered at INR 44,000-44,500/t ex Raipur.
  
  
• BF-route rebar: Indian tier-1 mills have announced reduction of INR 1,000-1,500/t in rebar list prices for early-July 2024. Current prices are hovering at INR 55,000/t exy-Mumbai. Trade-level blast furnace (BF) rebar prices declined by INR 900-1,500/t over the week across major markets amid sluggish domestic demand which negatively impacted market sentiments. Buying inquiries from end-users were limited, attributed to falling prices and lacklustre demand during the monsoon season.
  
  
• For the current week, rebar prices (12-32mm) in the trade segment dropped by INR 1,100/t w-o-w to INR 55,200/t ex-Mumbai, exclusive of 18% GST.
  
  
• In the projects segment, prices were hovering at INR 53,500-54,000/t FOR Mumbai.
  
  

Finished flats

• A few of the private Indian flat steel producers reduced prices of HRCs by around INR 1,000-1,750/t with effect from 1 July 2024. The price reduction for CRCs has been around INR 1,000-1,500/t for July 2024 sales.
  
  
• The current effective prices for HRC (2.5-8mm, IS2062, Gr E250, Br.) stands at INR 53,000-53,500/t ex-Mumbai, while those of CRC (0.9mm, IS513 CR1) hover around INR 60,000-60,500/t. An announcement from the PSU major is yet to be received.
  
  
• According to the vessel line-up data monitored by BigMint, India imported a total of 430,835t of bulk hot-rolled coils (HRC) and plates by June 2024, with cumulative imports reaching 357,329t by May 2024. An additional 219,909t of bulk HRCs and plates are expected to arrive in July 2024.
  
  
• India exported 95,732 t of bulk HRCs and plates in June, 2024, with total exports for May 2024 reaching 252,673 t.
  
  
• Indian mills have resumed HRC (S275, 3mm) export offers to Europe. Current offers are at $650-660/t CFR Antwerp ($600-610/t FOB east coast India). No firm deals were heard concluded as buyers are cautious with summer approaching, weak end-user demand and ample stock. Indian steel mills continued to hold their HRC export offers (S275, 3mm) to the EU this week.