Weekly round-up: Semi-finished steel prices trend up on moderate steel demand despite liquidity pressure

The domestic steel market witnessed a positive trend in prices during week 49 (2 dec-7 Dec, 2024). Semi-finished steel prices fell in the range of INR 350-700/tonne (t).

Iron ore and pellet

BigMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, fell by INR 200/t w-o-w to INR 8,950/tonne (t) DAP Raipur on 6 December. Raipur-based pellet-makers raised their offers for iron ore Fe 63% (+/_0.5%) on 7 December by INR 300/t ($4/t) to INR 9,000-9,100/t ($107-108/t) exw. Godawari Power & Ispat (GPIL) opened pellet offers for Fe63.5% and Fe65.5% at INR 9,300/t ($110/t), and INR 10,500/t ($124/t) exw, respectively.

BigMint's bi-weekly Indian low-grade iron ore fines (Fe 57%) export index increased by $2/tonne (t) w-o-w to $66/t FOB east coast, India, on 5 December 2024. The rise in buying interest ahead of the Chinese holidays fuelled a series of active deals, narrowing the price disparities between buyers and sellers. Over 400,000 t iron ore fines (Fe54-57%) export deals were concluded from the East Coast this week.

BigMint's India pellet (Fe 63%, 3% Al) export index (FOB east coast) decreased by $3/t w-o-w to $101.5/t on 6 December. Around 4 cargos (over 200,000 t) pellet export deals were concluded at $113-115/t CFR China in the beginning of the week but are yet to be confirmed. The gap between export and domestic realisations continued to narrow with more deals expected in the coming days.

Asia-Pacific Supramax dry bulk freights (50,000-55,000 tonnes) for iron ore shipments from the east coast of India to China dropped by $0.9/tonne (t) w-o-w to $11.3/t on 4 December. Dry bulk iron ore freights headed south this week amid a slowdown in iron ore demand, driven by colder weather in northern China, which disrupted construction activities and curtailed steel production.

Coal

Australian coking coal prices remained largely stable w-o-w at $204/t FOB on limited trades and subdued demand in key importing regions

RB2 (5500 NAR) grade coal prices remain unchanged w-o-w at $89/t FOB South Africa

Portside prices of South African thermal coal remained stable w-o-w, with RB2 (5500 NAR) at INR 9,500/tonne (t), according to BigMint's latest assessment. Meanwhile, RB3 (4800 NAR) increased by INR 200/t w-o-w to INR 7,800/t ex-Gangavaram due to a hike in offers hovering at INR 8,000/t from suppliers and trading houses.

Ferro Scrap

India's imported scrap market remained sluggish throughout the week, reflecting weak steel demand, liquidity challenges, and competitive domestic scrap prices.

Shredded offers from the US and UK/Europe dropped 1% to $378/t CFR from $383/t. While HMS stood at $357/t, down by 1% against $360/t w-o-w.

The availability of competitively priced domestic scrap further dampened interest in imports. Uncertainty over potential steel import duties and ongoing production cuts added to the cautious sentiment, leaving market participants in a wait-and-watch mode. Unless measures like safeguard duties are implemented, the market is expected to remain stagnant, with limited transactions and minimal activity throughout the week.

Around 11,000-12,000 t of scrap were booked, including 7,000-8,000 t of HMS (80:20) at $350-372/t from South Africa, the UK/EU, Somalia, the Middle East, Brazil, and the US. Additionally, PNS was booked at $385-389/t from the UK, and tin can shredded scrap was booked at $357/t CFR from the UK/EU.

Ferroalloys

Silico manganese: The domestic silico manganese market stabilised with a slight rise in prices. Fluctuating steel prices and low buying interest influenced the market, but overall, prices remained steady despite these factors, as news of production shutdowns kept the market cautious. Notably, prices of the 60-14 grade edged up by INR 400/t ($5t) w-o-w to INR 64,400-65,500/t ($760-773/t) exw in Raipur, Durgapur, and Visakhapatnam.

Ferro manganese: Indian ferro manganese (HC70%) prices inched up by around INR 600/t ($7/t) w-o-w to INR 66,900/t ($790/t) exw in Raipur and INR 67,000/t ($791/t), edged up INR 1,000/t ($12/t) exw-Durgapur. Prices moved up slightly as there were news of production cuts and limited supply in the region.

Ferro silicon: Indian ferro silicon (FeSi: 70%) prices decreased by INR 4,400/t ($52/t) w-o-w to INR 104,100/t ($1,229/t) exw-Guwahati on 6 December. Bhutanese prices also decreased by INR 5,000/t ($59/t) to INR 104,000/t ($1,228/t) exw. Prices dropped amid lower monthly offers from Bhutan, which declined by INR 5,400/t ($64/t) w-o-w to INR 104,000/t ($1,227/t) exw.

Ferro chrome:Indian high-carbon ferro chrome (HC60%, Si: 4%) prices fell by INR 1,400/t ($17/t) to settle at INR 106,000/t ($1,251/t) exw-Jajpur amid a widening bid-offer gap and the subdued response at Vedanta-FACOR's latest ferro chrome auction.

Additionally, bids have declined continuously at Vedanta-FACOR's last three ferro chrome auctions, including the recent one on 2 December. The larger lot of 10-150 mm was sold at INR 105,500/t ($1,245/t) exw, which was the base price.

Semi Finished

Semi-Finished Indian semi-finished steel prices showed an upward movement, as per BigMint's assessment. Domestic billet prices in almost all key locations increased INR 350-700/t in different regions, with a major increase of INR 700/t seen in the Durgapur and Ahmedabad market. Similarly, sponge iron prices also showed an upward trend, increasing by INR 100-800/t, with a major increase of INR 800/t seen in the Durgapur market.

On 6 December, NMDC's Nagarnar steel plant conducted an auction for 20,000 t of steel-grade pig iron at a base price of INR 31,000/t. Of the total offered volume, 15,000 t were booked at the base price. In the previous auction, on 3 December, only 5,000 t were booked at an average price of INR 31,000/t.

Tata Metaliks has reduced prices of foundry-grade pig iron by INR 1,500/t ($18/t) due to sluggish demand. Post-revision, prices stood at INR 38,500/t ($455/t) exw-Kharagpur. These prices are applicable for the Kolkata and Howrah markets. The price adjustment reflects the current subdued market conditions and demand trends.

On 3 Dec'24, NMDC's Nagarnar steel plant conducted an auction for 30,000 t of steel-grade pig iron at a base price of INR 31,000/t. However, only 5,000 t were booked at an average price of INR 31,000/t indicating subdued demand. In the previous auction, on 28 November 4,000 t was booked at an average price of INR 31,000/t.

Indian DRI (Direct Reduced Iron) export offers remained stable for CPT Raxaul, reaching $346/t while. CPT Benapole offers decreased by $1 reaching at $356/t.

Finished Long Steel

BF-rebar: Indian tier-1 mills reduced rebar list prices by up to INR 1,500/t for early-December 2024 sales. Post revision, list prices were hovering around INR 53,000-54,000/t on landed basis. Following this, trade prices showed downtrend due to lacklustre demand and liquidity crunch in the market.

Current week's rebar prices (12-32mm) in the trade segment dropped by INR 200/t w-o-w to INR 53,800/t exy-Mumbai, excluding 18% GST.

In the projects segment, prices were hovering around INR 52,000-53,000/t FOR Mumbai. Demand from end-user remained weak amid liquidity issues in the market.

Flat Steel

Indian mills announced a price support of INR 600-1,250/t for November. Furthermore, mills announced a roll-over of list prices for December. Effective list prices for HRC stand at INR 47,000-50,150/t ($555-592/t), while that for CRCs at INR 53,200-57,150/t ($628-675/t) ex-Mumbai, excluding GST at 18%.

India's hot-rolled coil (HRC) prices remained range-bound this week at INR 47,300-49,900/t ($559-589/t) amid slow sales. Cold-rolled coil (CRC) tags were stable at INR 53,500-58,500/t ($632-691/t) across various regions.

India's cumulative import volume, based on BigMint's vessel line-up data, stood at 571,656 t in November. Around 40,005 t of HRCs have already arrived by 5 December, while another 197,442 t are likely to arrive later in the month.

Indian exports of HRCs continued to remain slow this week. Chinese exporters with their competitive offers kept the preference away from Indian-origin HRCs in the global market. Export prices to Europe for the S275 grade, 3 mm thickness, remained unchanged at $585-595/t CFR Antwerp ($535-545/t FOB east coast India) on 22 November.