Weekly round-up: Semi-finished steel prices edge up on moderate uptick in steel demand

The domestic steel market witnessed a positive trend in prices during week 28 ( 24 July- 29 July,2023). Semi-finished steel prices increased by INR 300-1,250/tonne (t).

Domestic induction furnace finished long steel prices exhibited a mixed trend. Prices continued to vary by up to INR 100-1,000/t. Trade reference prices for hot rolled coil (HRC) and cold rolled coils (CRC) edged up this week in some markets.

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, dropped by INR 150/t to INR 8,800/t DAP Raipur on 28 July 2023 as compared to the previous week. Deals of 25,000 tonnes (t) were recorded at INR 8,800-9,150/t (Fe 63/63.5%) DAP Raipur throughout the week.
  
  
• The NMDC's auction for 240,000 t from Kumaraswamy mines on 28 July received bids for 84,000 t of lumps (10-40mm, Fe 60.34-64.93%) and 20,000 t of fines (Fe 59.22%) at the base price of INR 3,102-3,860/t and INR 2,710/t, respectively. Prices include royalty, DMF & NMET.
  
  
• SKMEPL's 16,000 t auction, 4,000 t (10-40mm, Fe 64%) of lumps was booked at the base price of INR 4,700/t on 28 July.
  
  
• SteelMint's weekly India low-grade iron ore fines (Fe 57%) export index remained unchanged w-o-w at $65/t FOB east coast, as assessed on 27 July 2023. The market was optimistic this week as some trades were concluded from eastern and southern India and sellers getting inquiries from the China market. A total of four deals of around 390,000 t were concluded from India in the last one week, as per data recorded by SteelMint
  
  
• SteelMint's India pellet (Fe 63%, 3% Al) export index FOB east coast inched up by $1/t w-o-w to $108/t on 26 July, 2023. No deal was heard this week amid low seaborne market sentiments and no inquiries from the Chinese market were heard in this publishing window.
  
  

Coal

• Australian premium hard coking coal prices remain largely stable w-o-w to $237/t FOB and $249/t CNF India on 29 Jul'23 on limited trading activity.
  
  
• Portside prices of South African RB3 (4800 NAR) thermal coal at Vizag Port recorded at INR 7,300/t, largely stable w-o-w amid tepid demand.
  
  
• RB1 (6000 NAR) grade prices rose by around 10% on weekly basis to $106/t FOB and RB3 prices fell by around 14% to $62/t FOB Richards Bay, South Africa.
  
  

Ferro Alloys

• According to SteelMint assessment on 28 July 2023, silico manganese (60-14) offers were hovering at INR 65,200-67,000/t exw, Raipur, Durgapur and Vizag, unchanged w-o-w due to low trading activity. In addition, Prices for silico manganese may remain stable in the short run since sellers have little room to decrease prices further and are unwilling to do so.
  
  
• Low export inquiries and a lacklustre demand for special steel caused Indian ferro manganese (HC70%) prices to hold steady week after week. On July 28, 2023, Ferro manganese offers were estimated by SteelMint to be hovering between INR 67,500-68,000/t exw in both Durgapur and Raipur.
  
  
• According to SteelMint, Indian ferro chrome (HC60%) prices were INR 104,000/t exw-Jajpur on July 27, rose INR 6000 /t w-o-w after experiencing a seven-week decline. The upswing was driven by high production costs after strong prices were seen in the recent chrome ore auction conducted by Odisha Mining Corporation(OMC) on 20 July. China's optimistic market outlook had also a positive effect, leading to a surge in export offers, which in turn boosted domestic prices.
  
  
• As of 28th July, SteelMint's assessment witnessed a drop in Indian ferro silicon (70%) prices to INR 105,300/t exw-Guwahati, dropped by INR 1,900/t w-o-w. The decline in prices attributed to subdued demand and ample amount of material in the market. Furthermore, anticipation of lower price announcements from Bhutan in the upcoming month has led buyers to hold back on bookings, resulted in sluggish demand this week.
  
  

Semi finished

• Indian semi-finished steel prices increases as per SteelMint's assessment. Domestic billet prices increased by INR 100-800/t across regions, with a major increase of INR 800/t seen in Mumbai. Similarly, sponge iron prices also increased by INR 300-1,250/t, with a major increase of INR 900-1,250/t seen in Durgapur and Raipur w-o-w.
  
  
• SAIL-Durgapur Steel Plant (DSP) held an auction for 2,000 t of steel-grade pig iron on 28 Jul'23. According to sources, the entire quantity was booked at an average price of INR 38,750/t exw.
  
  
• SAIL-Bhilai Steel Plant (BSP) held an auction for 5,980 t of steel-grade pig iron on 28 Jul'23. According to sources, the entire quantity was booked at an average price of INR 38,100/t exw.
  
  
• Neelachal Ispat Nigam Ltd (NINL) - a Tata Steel subsidiary based in Odisha - has concluded a 1,000 t of steel-grade pig iron auction on 27 Jul'23. The entire quantity has been booked at an average price of INR 37,500-37,600/t exw, as per sources.
  
  
• West Bengal-based Bengal Energy Ltd has started domestic commercial sale of pig iron with the commissioning of its 0.4 mnt/year blast furnace in Kharagpur.
  
  

Finished Long

• India's finished long steel market of IF route witnessed a need-based buying in first half of the week while the demand slightly improved later the week vary region wise by seen increased in raw material (steel billet and sponge prices) specifically in central and northern region. Market was trying to stabilize in the spot market. Although, healthy trades were lacking due to gradually rising inventories in the mills so, manufactures preferred either to marginal decline in offers or adjusting trade discounts depending upon payment and delivery terms.
  
  
• On a weekly basis, In rebar steel prices shows mixed trend vary region wise, decreased by up to INR 900/t in Northern and Southern regions, also few markets like Jalna, Mumbai and Patna were marginal down by INR 100-400/t whereas Central and Eastern belt plus by up to INR 1,000/t and some locations seen stable like Hyderabad and Goa 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 43,600-44,000/t exw Raipur, INR 46,700-47,300/t exw Jalna.
  
  
• Trade reference price of Heavy structural steel for base size 150mm channel stands at INR 46,700-47,000/t exw Raipur.
  
  
• Trade reference prices of Wire Rod hovering at 44,500-44,800/t ex Raipur.
  
  
• Trade level prices of blast furnace (BF) route rebars dropped w-o-w across major markets amid sluggish domestic demand. This has been the 25th consecutive week of decline in trade prices.
  
  
• Rebar offers in the projects segment are hovering around INR 47,000-48,000/t FOR Mumbai. However, orders are not being placed at the current price levels as bookings have been kept on hold and market participants are awaiting mills' price announcements for early-August dispatches.
  
  
• SteelMint's weekly price assessment for rebars (12-32 mm, BF-route, IS 1786, Fe500D) for the trade segment fell by INR 500/t w-o-w to INR 50,500/t, exy-Mumbai, excluding GST at 18%.
  
  

Finished Flat

• Trade level flat product prices have edged up this week in a few markets amid the buzz about mills' intent to increase list prices for August sales. Imports coming in July had little impact on the price direction as they filled the gap created by the maintenance downtimes of major producers earlier this month.
  
  
• However, distributors have been quoting higher in the market despite the cautious buyers still avoiding purchases in bulk volumes.
  
  
• An import deal for 10,000-15,000 t was heard booked last weekend from Vietnam. The deal was sealed around $615-620/t CFR India, and scheduled for delivery in mid-September, informed sources. Other than this, there have been no major deals heard booked for September shipment.
  
  
• On the exports front, SteelMint's India HRC (SAE1006) export index has stayed at $570/t FOB east coast since 27 June 2023. Indian mills have kept export offers on hold and likely to come up with higher quotes in the first week of August.
  
  
• Constrained production in India, slow demand in the Middle East (ME) and Europe are the primary reasons for the holding back of offers. Meanwhile, Chinese government is prioritising production cuts in the second half of CY2023 (H2CY2023) which has boosted the performance of SHFE HRC futures (Oct'23 contracts). This in turn has pushed the export offers for HRC (SS400) higher at $585/t FOB Rizhao (up $30/t w-o-w) as on 25 July 2023.