Weekly round-up: Semi-finished steel market fluctuates; ferro alloys prices range-bound

The domestic steel market saw a seesaw trend in prices during week 3 ( 15-20 Jan, 2024). Semi-finished steel prices varied in the range of INR 100-400/tonne (t).

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, decreased by INR 250/t w-o-w to INR 9,600/tonne (t) DAP Raipur on 19 January, 2023. A deal of 10,000 t was recorded from the Raipur region in the last one week. PELLEX dropped by around INR 500/t in this week by the pellet makers of Raipur.
  
  
• OMC conducted an auction for 2.8 mnt of iron ore on 19 January 2024. Buyers participated actively, and almost the entire quantity of fines (Fe 54-65%, 1.524 mnt) was booked at INR 3,910-6,050/t while out of 1.241 mnt of iron ore lumps (Fe 58-64%), buyers booked 1.048 mnt at INR 4,750-7,850/t. Bids for fines and lumps increased by INR 100-1,000/t and INR 50-550/t against bid prices in Dec'23 auction.
  
  
• NMDC Donimalai had an auction for 28,000 t of iron ore on 17 January. This included 20,000 t of fines (Fe 59%) and 8,000 t of lumps (10-40 mm, Fe 59%). According to sources, the entire quantity of fines and lumps got booked at base price of INR 3,542/t and INR 3,694/t, respectively. Prices are on FOR, ex-stockpile/mines basis, including royalty, DMF and NMET.
  
  
• In the OMDC auction on 17 January, 31,556 t (Fe 58.14-59.24%) of iron ore fines booked at INR 2,200-2,980/t against base price of INR 2,200/t from its Bhadrasahi Iron and Mn ore mines. 7,915 t (Fe 51.30-52.28%) of screened fines booked at base price of INR 1,700/t from its Bagiaburu Mines. Prices are on FOT basis, excluding royalty, DMF & NMET.
  
  
• SteelMint's India pellet (Fe 63%, 3% Al) export (FOB east coast) index decreased by $5/t w-o-w to $120/t on 17 January. SteelMint's weekly Indian low-grade iron ore fines (Fe 57%) export index decreased by $5/tonne (t) w-o-w to $83/t FOB east coast on 18 January.
  
  

Coal

• Australian premium hard coking coal prices remained largely stable w-o-w to $335/t FOB and $350/ t CNF on 20 Jan'24 amid lower buying interest due to weak margins.
  
  
• RB1 (6000 NAR) grade prices dropped by 7% w-o-w to $92/t FOB. Similarly, RB3 prices dropped by 11% w-o-w at $63/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port recorded at INR 7,700/t, down by INR 300/t w-o-w.
  
  

Ferro Scrap

• During the week, interest in purchasing imported scrap in India remained subdued, primarily due to the disparity between offers and bids. Additionally, some buyers showed a preference for materials from South East Asia and Australia, citing the advantages of swift shipment and shorter voyage times. A bulk vessel, carrying 35,070 t of mixed scrap, docked at Kandla port, and notably, Mono Steel Gujarat made the acquisition.
  
  
• An official from a steel mill remarked, "We are not actively seeking new offers at the moment, as the previously booked material is facing delays and is anticipated to arrive by February."
  
  
• A trader stated, "The market is currently experiencing a slower pace, and we are maintaining our existing offers, given the apparent lack of interest in the market at this time."
  
  
• On a weekly average, shredded scrap offers were at $421/t CFR Nhava Sheva, a marginal increase of $1/t compared to $420/t CFR a week ago. Meanwhile, HMS (80:20) offers averaged $401/t CFR Nhava Sheva, rising by $1/t compared to the previous week's $400/t. Importantly, imported scrap offers saw a mid-week increase due to higher freight rates but remained volatile during the week amid weak downstream demand.
  
  
• As per a trade source, current freight rates are notably elevated, with the UK-to-Mundra freight doubling and presently standing at $1,500-1,800/container.
  
  

Ferro Alloys

• Silico manganese: Indian silico manganese prices were stable, owing to stability in imported manganese ore prices and increased overseas inquiries. The volatility in steel pricing was also a factor to consider when conducting market purchases, as aggressive negotiations and need-based buying occurred. On January 19, 2024, ndian silico manganese (60-14) was trading at approximately INR 64,200-64,700/t ($772-$778/t) ex Durgapur, Raipur, and Vizag.
  
  
• Ferro Manganese:Ferro manganese (HC70%) prices remained stable w-o-w on limited demand and continual production cuts. According to SteelMint, ferro manganese offers in Durgapur and Raipur on 19 January ranged from INR 64,800 to INR 65,000/t ($780-$782/t) exw.
  
  
• Ferro Silicon: Prices of Indian ferrosilicon (FeSi:70%) increased by INR 700/t ($8/t). The expiration of several Bhutanese producers' Bureau of Indian Standards (BIS) licenses, which are required for exporting goods to India, created a supply shortage in the Indian market. This caused Indian producers to quote higher pricing. According to SteelMint, the price of ferro silicon in India on January 19 was INR 110,200/t ($1,326/t) ex-Guwahati. Prices in Bhutan also rose by INR 5,500/t ($66/t) week on week, reaching INR 111,500/t ($1,341/t) exw.
  
  
• Ferro Chrome: On January 19, prices for Indian ferro chrome (HC 60%, Si:4%) increased by INR 300/t ($4/t) to INR 113,000/t ($1,359/t) ex-Jajpur. Prices rose due to a supply-demand constraint, and they are expected to rise further following the OMC's chrome ore auction, in which bidders booked the whole quantity at a higher premium. However, stainless steel prices for the 304 grade remained stable week after week, at INR 173,000/t ($20,808/t) exw-Mumbai.
  
  

Semi-Finished

• Indian semi-finished steel prices decreased, as per SteelMint's assessment. Domestic billet prices in almost all key locations decreased by INR 100-400/t across regions, with a major decrease of INR 400/t seen in Durgapur. However, billet prices in Mumbai rose slightly by INR 100/t. Similarly, sponge iron prices also decreased in key locations by INR 50-500/t, with a major decrease of INR 500/t seen in Ramgarh.
  
  
• Tata Metaliks announced a hike in prices of INR 1,000/t ($12/t) for pig iron (both basic and foundry grades) due to demand upshot at previous offers.
  
  
• SAIL's Rourkela Steel Plant auctioned 1,100 t of steel-grade pig iron on 17 Jan'24. The entire material was booked at an average price of INR 37,400/t exw.
  
  
• SAIL-Durgapur Steel Plant held an auction for 2,000 t of steel-grade pig iron on 16 Jan'23. The entire quantity was booked at an average price of INR 37,900/t exw.
  
  
• Indian DRI (Direct Reduced Iron) export offers decreased by approximately $5/t, reaching $365/t on CPT Raxaul, and $375/t on CPT Benapole.
  
  

Finished-long steel

• Finished Long Steel (IF Route): India's induction furnace route finished long steel prices kept fluctuating trend w-o-w. In the initial couple of days of this week trade activities were impacted due to festival (Makar Sankranti and Pongal) in the country and buying inquiries were limited, which prompted suppliers to offer trades discounts in the spot market. However, from the middle of the week some improvement was observed but still buyers steered clear of any bulk procurement owing to uncertainty in the market at the moment. Market participants expect prices are likely to remain range-bound in the near term due to the excess inventory pressure on the mills.
  
  
• On a weekly basis, in rebar steel prices fluctuated in the range of INR 100-500/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 43,000-43,400/t exw Raipur, INR 48,000-48,500/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150mm channel stands at INR 46,100-46,400/t exw Raipur.
  
  
• Trade reference prices of wire rod hovering at INR 43,200-43,700/t ex Raipur.
  
  
• BF-route rebar: Trade-level prices of blast furnace (BF) route rebars fell on w-o-w basis amid subdued domestic demand and currently trade prices are hovering at 5-month low as similar levels were last seen in August 2023, SteelMint data shows. Also, this has marked the 15th consecutive week of decline in prices and buyers have opted need-based purchases amid continuous fall in prices.
  
  
• SteelMint's weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) for the trade segment fell by INR 500/t to INR 51,500/t, exy-Mumbai, excluding GST at 18%.
  
  
• In the projects segment, prices are currently hovering at INR 50,000-50,500/t on FOR Mumbai basis.
  
  

Finished flate steel

• • Flat Steel Weekly: The market remains cautiously range-bound, with trading activities primarily limited to need-based purchasing at lower price levels. Abundant stocks of more economical domestic alternatives act as a stabilizing factor, preventing significant price fluctuations.
    
    
  • SteelMint's benchmark assessment (bi-weekly) for HRC (IS2062, Gr- E250, 2.5-8mm) stood rangebound at INR 53,500-54,500/t on 18 January 2024, and that of CRC (IS513, Gr-O, 0.9mm) hovered at INR 61,500-62,500/t. (Ex-Mumbai, CTL, excluding GST at 18%)
    
    
  • Import volumes of bulk HRC and plates totalled 3,08,721t in January 2024 (provisional), a notable decline from the 5,29,661t recorded in December 2023.
    
    
  • SteelMint's export index for Indian Hot Rolled Coils (HRC) with SAE 1006 specification declined this week, settling at $600/t Free on Board (FOB) on the east coast of India, down from the previous week's $605/t FOB. Chinese offers affected the competitiveness of Indian HRC in the Vietnamese market. In Europe, a $25/t weekly increase in Indian HRC exports (S275, 3mm) is driven by high domestic prices and a EUR 50/t hike by a leading European mill, despite cautious buying due to exhausted Q1 safeguard quotas.