Weekly round-up: Semi-finished steel prices drop on low demand

The domestic steel market saw negative trend in prices during week 20 ( 20-25 May, 2024). Semi-finished steel prices dropped in the range of INR 150-1,000/tonne (t).

Iron ore, pellet

• BigMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, increased by INR 250/t w-o-w to INR 10,550/tonne (t) DAP Raipur on 24 May. Around 85,000 deals of pellets (Fe62.5-63%) were recorded in the Raipur region in the last one week. Pellet prices in the central eastern region increased by INR 500-600/t amid the premium bids in the OMC iron ore auction.
  
  
• OMC conducted around 3 million tonnes (mnt) iron ore auction on 21 May 2024 from Odisha. Out of 1.807 mnt of iron ore fines (Fe 54-65%), entire quantity was booked at INR 4,220-6030/t. For the 1.19 mnt of iron ore lumps (Fe 58 to 65+%) auction, the buyers successfully bid for around 1.05 mnt of lumps at INR 4,850-7,850/t. Bids in the OMC auction increased by around INR 300-1,000/t and INR 150-1,300/t against the set base price for fines and lumps respectively.
  
  
• BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index rose by $3.5/t w-o-w to $68.5/t FOB east coast on 23 May 2024. Around 135,000 t of standard grade Fe 57% fines deals were concluded by Indian sellers in this publishing window. A giant miner from Odisha also concluded 110,000 t of Fe 54% fines at $68/t CFR China a few days back. Meanwhile, one more deal of around 55,000 t (Fe 57% fines) was also heard at $84/t CFR China but could not be confirmed by sellers.
  
  
• BigMint's India pellet (Fe 63%, 3% Al) export index (FOB east coast) increased w-o-w by around $6/ t to $109/t on 22 May 2024. Seaborne prices of Indian premium material recovered following improved market fundamentals in the Chinese steel market. An eastern India-based producer sold a 55,000-t pellet (Fe 63%) cargo at $124-125/t CFR China in this publishing window. An Indian pellet producer issued a tender for the sale of 110,000 t of iron ore pellets (Fe63%, 8% Al2O3+SiO2) on 22 May, 2024. As per sources, the tender successfully concluded at $116-118/t FOB amid decent interest from buyers for June delivery.
  
  
• 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 inched down by $0.3/t this week to $15/t on 22 May, as per BigMint's assessment. Dry bulk iron ore freight rates softened slightly this week for key routes. Availability of vessels in global markets has improved, pulling down freight rates. Meanwhile, iron ore demand from China has remained strong because of an expected increase in steel demand amid government stimulus measures.
  
  

Coal

• Australian premium hard coking coal prices rose by $4/t w-o-w to $239/t FOB and $257/ t CNF on 24 May, 2024 due to increased demand for July-loading cargoes, with international buyers bidding higher, expecting tighter supply from key Australian miners and growing demand from Asian end-users.
  
  
• RB1 (6000 NAR) grade prices stood stable w-o-w at $106/t FOB. However, RB3 edged down w-o-w to $79/t FOB Richards Bay, South Africa.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port recorded at INR 8,400/t, stable w-o-w.
  
  

Ferro scrap

• In India, demand for imported scrap remained sluggish this week due to bid-offer disparities and expectations of a decline in offers amidst softening global scrap market sentiments. On a weekly average basis, shredded scrap offers from the US and Europe dropped by $8-10/t, reaching $414/t CFR from the US and $418/t CFR from Europe.
  
  
• HMS (80:20) offers averaged $401/t CFR (a decrease of $4/t w-o-w) from Europe and $400/t CFR (a decrease of $6/t) from West Africa.
  
  
• Notably, around 16,000 t of mixed scrap were booked during the week by multiple Indian mills. These included shredded scraps, HMS 80:20, HMS 90:10, HMS handloaded, NTP scraps, as well as blue steel scraps from various locations such as the US, Australia, the UK, Malaysia, Bahrain, West Africa, and Yemen.
  
  

Ferro alloys

• Silico manganese: Silico manganese prices in India fell by INR 4,950/t ($60/t) to INR 82,300-83,800/t ($991-1,009/t) exw across major markets of Raipur, Durgapur, and Vizag. These prices fell due to the need-based procurements in the domestic market.
  
  
• Ferro manganese: Ferro manganese (HC70%) prices declined by INR 2,800/t ($34/t) in Raipur, reaching INR 88,200/t ($1,062/t) exw. Meanwhile, in Durgapur prices also diminished by INR 3,300/t ($40/t) and stayed at INR 88,800/t ($1,069/t). Prices decreased as buyers were hesitant in accepting higher quotes.
  
  
• Ferro silicon: Indian ferro silicon (FeSi:70%) prices diminished by INR 1,100/t ($13/t) in both the regions on limited market inquiries, settling at INR 99,300/t ($1,196/t) exw-Guwahati on 24 May. Meanwhile, Bhutan prices were also down by INR 1,100/t ($13/t), reaching INR 98,300/t ($1,184/t) exw.
  
  

Ferro chrome

• Prices of Indian high-carbon ferro chrome (HC60%, Si:4%) stayed steady with slight decline by INR 200/t ($2/t) on 24 May, settling at INR 106,300/t ($1,280/t) exw-Jajpur . Prices stayed stable because the market did not show any significant improvement in demand.
  
  
• Additionally, all 67,300 t were sold at OMC's chrome ore auction, with bids dropping m-o-m for most grades. However, the ferro chrome auction received subdued response and was concluded at the base price.
  
  

Semi-finished

• Indian semi-finished steel prices decreases as per BigMint's assessment. Domestic billet prices in all key locations decreased by INR 150-1,000/t across regions, with a major decrease of INR 1,000/t seen in the Chennai market. Similarly, sponge iron prices also decreased in key locations by INR 250-900/t, with a major decrease of INR 900/t seen in the Jharsuguda market.
  
  
• SAIL-Durgapur Steel Plant (DSP) held an auction for 2,500 t of steel-grade pig iron on 21 May'24. Total quantity was booked at an average price of INR 41,275/t exw.
  
  
• Indian DRI (Direct Reduced Iron) export offers increased by approximately $1-3/t, reaching $410/t on CPT Raxaul, and $408/t on CPT Benapole.
  
  

Finished long steel

• If-rebar:India's induction furnace route finished long steel market sentiment remained dull as prices moved South this week. Limited buying interest at higher prices due to uncertainty in the market direction forced suppliers to give trade discounts to liquidate the material. Fluctuation in prices of sponge iron and steel billet further led to the current market scenario. Since price gap between the IF route and BF route rebar steel is still high, so IF route rebar prices are likely to remain range-bound in the near term.
  
  
• On a weekly basis, in rebar steel prices decreased by INR 200-1,200/t across the regions except few market remained stable as per BigMint 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 47,400-47,800/t exw Raipur, INR 51,500-52,000/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150mm channel stands at INR 49,800-50,200/t exw Raipur.
  
  
• Trade reference prices of wire rod hovering at INR 47,700-48,200/t ex Raipur.
  
  

• Bf-rebar: Trade-level BF-rebar prices remained range-bound on weekly basis across markets. Buying interest at current price levels remained slow and there are limited inventories in the trade channel due to maintenance shutdown taken by major tier-1 mills during April-May period. The PSU steelmaker has started operations as the supply of coking coal from Adani Gangavaram has resumed last week, which will improve supplies in the market going forward.
  
  
• Current week's rebar prices (12-32mm, Fe500D) in the trade segment dropped by INR 300/t w-o-w to INR 58,400/t exy-Mumbai. Prices are exclusive of GST at 18%.
  
  
• In the projects segment, prices were hovering around INR 57,500-58,000/t FOR Mumbai.
  
  

Finished flat steel

• Hot-rolled coil (HRC) and cold-rolled (CR) coil prices remained rangebound as market participants awaited clarity on price supports by mills and election results.
  
  
• BigMint's benchmark assessment (bi-weekly) of HRC (2.5-8mm, IS2062, Gr E-250 Br.) prices increased by INR 400/t to INR 54,400/t on 24 May 2024, compared to the previous week. Also, CRC (0.90mm, IS 513, CR1) prices inched up by INR 100/t to INR 60,900/t during the same period. These prices are quoted ex-Mumbai, excluding 18% GST, and are for cut-to-length (CTL) deliveries. (INR 1 = USD 0.0120154 ; USD 1 = INR 83.2265)
  
  
• The market exhibited sluggishness due to limited demand and constrained supply, although SAIL's production re-entering the market provided some relief.
  
  
• Export and import trends reveal a deceleration in India's trade of bulk hot-rolled coil (HRC) and plates, with domestic market prioritisation by steel mills leading to the suspension of export offers to Southeast Asia, the Middle East, and Europe. As of May 20, 2024, India's imports of bulk HRC and plates totalled 126,660 t. Conversely, India's exports of bulk HRC and plates amounted to 109,464 t until May 2024, based on vessel line-up data monitored by BigMint.