Weekly round-up: Semi-finished steel prices subdued on moderate demand

The domestic steel market witnessed a positive trend in prices during week 30 ( 7 August - 12 August, 2023). Semi-finished steel prices increased by INR 600-1,500/tonne (t).

Domestic induction furnace finished long steel prices rose by INR 2,000/t w-o-w. Trade reference prices for hot rolled coil (HRC) and cold rolled coil (CRC) remained stable this week in some markets.

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, remained unchanged at INR 9,050/t DAP Raipur on 11 August compared to the previous week following less active trades at higher offers. Limited deals of 1,500 t were recorded at INR 9,250/t (Fe 63/63.5%) DAP Raipur this week.
  
  
• NMDC conducted two iron ore auctions from Chhattisgarh on 10 August. 37,800 t of iron ore from Bacheli, including 8,400 t of DR-CLO (10-40 mm, Fe67%), was booked at INR 7,520/t against floor price of INR 6,320/t. 16,800 t of fines (Fe64%) was booked at base price of INR 4,250/t. The entire quantity of 92,400 t from Kirandul mines remained unsold. Delivery will be by FOR (by rail) ex-mine inclusive of royalty.
  
  
• Steel Authority of India Ltd (SAIL) concluded an auction for 20,000 t of iron ore dump fines (Fe 57.44%) from its Bolani mines in Odisha on 11 August. According to sources, the entire quantity got booked in the auction. Bids were initiated at a base price of INR 2,660/t and concluded at INR 3,110/t. 19,850 t of iron ore tailings (indicative Fe 60.52% ) from its Barsua mines, Odisha on 8 August was sold at INR 4,080/t ex-mines, including royalty, DMF and NMET.
  
  
• SMIORE conducted an auction for 60,000 t of iron ore lumps (5-40mm, Fe56.5-60.5%) from Karnataka on 7 August. According to sources, the auction received good response with the entire quantity getting booked at INR 4,570-5,950/t against the base price of INR 4,110-4,660/t. Prices include royalty, DMF and NMET.
  
  
• SteelMint's India pellet (Fe 63%, 3% Al) export (FOB east coast) index decreased by $3/t w-o-w to $101/t on 9 August. No deal was heard this week amid muted seaborne market sentiments and the absence of firm inquiries from buyers amid sluggish demand for pellets in China.
  
  

Coal

• Australian premium hard coking coal prices rose by 2% w-o-w to $251/t FOB and $266/t CNF India on 11 August. Prices increased due to rising demand.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port were recorded at INR 7,350/t, stable w-o-w amid bid-offer disparity.
  
  
• RB1 (6000 NAR) grade prices rose by 6% w-o-w to $108.5/t FOB. Similarly, RB3 prices rose by around 6% to $74/t FOB Richards Bay, South Africa
  
  

Ferrous scrap

• This week, India's scrap market observed a few high-priced deals similar to offers prevailing last week. Fresh offers for shredded scrap of UK/EU-origin now stand at $420-422/t CFR. Scrap markets in other South Asian countries like Bangladesh and Pakistan are less active due to weak domestic demand and limited responses from buyers. These markets are waiting for further price correction, according to sources.
  
  
• India's imported scrap market continued to witness an uptrend in prices. With the domestic market remaining stagnant, buyers showed less interest. The semi-finished and finished markets did not see significant sales. Steel producers are closely monitoring the market dynamics in India as steel demand is showing signs of improvement. In July, the consumption of imported scrap increased by 10% y-o-y. Given the active participation of scrap buyers, suppliers are hesitant to reduce their offers. Some buyers are anticipating a cooling off in prices, as per sources.
  
  
• For Europe-origin HMS (80:20), offers of CFR Nhava Sheva were heard at $395-400/t. Meanwhile, bids were reportedly in the range of $390-392/t, reflecting a decrease of $5-8/t. West African HMS (80:20) was priced at $390-392/t for West Coast India and $395-398/t for South Coast India this week.
  
  

Ferro alloys

• On 12 August, offers for silico manganese (60-14) ranged from INR 66,000-67,000/t exw in Durgapur, Raipur, and Vizag, an increase of about INR 400/t w-o-w. However, manufacturers are facing a decline in profits due to material costs falling below production expenses, causing them to resist further reduction.
  
  
• Indian ferro manganese (HC70%) prices have remained stable w-o-w due to lack of export inquiries and weak demand for special steel. On 12 August, SteelMint assessed ferro manganese offers at INR 67,200-67,700/t exw in Durgapur and Raipur.
  
  
• Indian ferro chrome (HC60%, Si:4%) prices rose by INR 2,000/tonne (t) w-o-w, driven by an increase in offers of domestic producers in response to a surge in export demand from China. According to SteelMint's assessment on 10 August, Indian ferro chrome (HC60%, Si:4%) prices stood at INR 106,000/t exw-Jajpur. Meanwhile, Vedanta-FACOR's ferro chrome auction held on 9 August was concluded at INR 105,800/t for the bigger lot of 10-150 mm.
  
  
• After being under pressure for several weeks, Indian ferro silicon (Si:70%) prices climbed INR 2,000/t w-o-w. The uptick in prices was may be due to increased domestic stainless steel demand and a gradual shift in market mood. Indian ferro silicon prices were at INR 104,000/t exw-Guwahati on 11 August. Similarly, Bhutanese offers increased by INR 3,000/t w-o-w to INR 105,000/t exw. However, some Bhutanese producers have started offering higher prices, sources informed.
  
  

Semi-finished

• Indian semis prices fell this week as finished steel demand in major regions remained weak. Domestic billet prices in some key locations fell in the range of INR 100-550/t, with a significant drop of INR 550/t reported in Rourkela, whereas billet prices in Durgapur, Goa and Jalna saw a marginal uptick of INR 100-300/t. Similarly, sponge iron prices showed a mixed trend with producers in major locations lowering their offers by INR 200-400/t w-o-w. However, sponge iron prices in Ramgarh, Durgapur, Mandi Gobindgarh and south India rose by INR 400-600/t.
  
  
• SAIL-Bhilai Steel Plant (BSP) held an auction for 4,030 t of steel-grade pig iron on 11 August. According to sources, the quantity of 3,770 t was booked at an average price of INR 39,000/t exw.
  
  
• SAIL-Rourkela Steel Plant (RSP) held an auction for 900 t of steel grade pig iron on 11 August, 2023. The entire quantity was booked at an average price of INR 39,050/t exw.
  
  
• SAIL-IISCO's Burnpur Plant held an auction for 500 t of steel grade pig iron on 8 August, 2023. The total quantity was booked at an average price of INR 39,350/t exw.
  
  
• SAIL-Durgapur Steel Plant held an auction for 2,500 t of steel grade pig iron on 8 August. The total quantity was booked at an average price of INR 39,450/t exw.
  
  
• A leading steelmaker in Odisha has sealed a 5,000 t steel-grade pig iron deal at INR 39,200/t exw. The material will be loaded for central India.
  
  

Finished long

• India's induction furnace-route finished long steel market observed dull buying enquiries this week. Buying activities remained slow and marginal fluctuations were seen in prices throughout the week. Sellers tried to hold higher offer prices, but sales remained weak, which forced them to offer attractive trade discounts in rebar, wire rod and structure steel. Despite this, demand was low. Considering the current market scenario, traders are not willing to procure bulk quantities. However, a few BF mills have increased their list prices in the middle of the week which may provide a soft push to prices in the near term.
  
  
• Rebar prices showed mixed trends, fluctuating by INR 100-800/t region wise, while in a few markets prices remained stable, as per SteelMint's assessment.
  
  
• The trade reference price of Fe 500 grade rebar manufactured via the IF route for 10-25 mm size was assessed at INR 43,800-44,200/t exw Raipur, INR 47,300-47,800/t exw Jalna.
  
  
• Trade reference price of heavy structural steel for base size 150mm channel stands at INR 47,000-47,400/t exw Raipur.
  
  
• Trade reference prices of wire rod hovering at INR 45,000-45,500/t exw Raipur.
  
  
• Trade level prices of rebars edged up w-o-w in major markets as primary mills announced interim price hike of INR 500/t in rebar list prices with effect from 10 August 2023. Meanwhile, buying activities in the traders' market remained weak.
  
  
• Current project segment offers were heard at around INR 49,000-50,000/t FOR Mumbai, registering an increase of INR 500-1,000/t against last week. Enquiries in the projects segment increased during early-August as compared with last month and major infrastructure companies have completed their procurement at the beginning of the month.
  
  
• SteelMint's weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) for the trade segment edged up by INR 300/t w-o-w at INR 50,800/t, exy-Mumbai, excluding GST at 18%.
  
  

Finished flat

• Trade-level prices of flat steel products increased slightly at the beginning of the week. Trade prices of HRC stood around INR 56,000-57,000/t exy-Mumbai, excluding GST at 18%.
  
  
• Market sentiments however remain mixed. Buying interest in the traders' market, continued to remain lacklustre as buyers are still cautious about procuring in bulk volumes. Shortages in supply of certain thicknesses and the price increase announced by mills have led to higher quotes in the traders' market.
  
  
• On the exports front, SteelMint's HRC (SAE1006) export index stood unchanged at $570/t FOB east coast India. Mills continue to hold back offers in the markets of Middle East (ME) and Vietnam. Also, demand in the European markets is sluggish amid the summer vacations. However, some small consignment of 2,000 t HDGI was heard booked for export to Europe last weekend. The deal was sealed at $880/t CFR Europe, for September shipment.