Weekly round-up: Semis, longs markets upbeat even as flat steel trade prices edge lower

The domestic steel market saw an uptrend in prices during week 28 ( 4-9 July, 2022). Semi-finished steel prices rose in the range of INR 500-3,100/tonne (t).

Domestic induction furnace finished long steel offers edged higher this week. Offers rose by up to INR 2,500/t w-o-w. However, the trade reference prices for finished flats fell in the range of INR 100-1,500/t for HRC and CRC.

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 8,500/tonne (t) DAP Raipur on 8 July. Around 67,000 t of pellet (Fe 62/Fe 63%) deals were reported at INR 8,000-8,650/t DAP Raipur of which 50,000 t were taken into consideration in the assessment.
  
  
• SAIL conducted an auction for 40,000 t of iron ore tailings (Fe 58%- indicative) from its Barsua iron ore mine this week. Out of the total offered quantity, about 20,000 t received bids at INR 2,400/t (ex-mines, including royalty, DMF, NMET and additional premium).
  
  
• State PSU miner OMC scheduled an iron ore auction for 18 July. Around 1.23 mnt of lump ore and 1.56 mnt of iron ore fines will be put up for auction. The base price of the auction is yet to be disclosed. OMC's previous auction received weak response, as out of 2.77 mnt of material on offer, only 0.166 mnt (6%) received bids.
  
  
• India's pellet export market remained silent for yet another week. Due to low steel margins, buying interest for pellets continued to remain muted from the overseas market, particularly from China. Also, buyers were sceptical about Indian supplies post export duty imposition. Meanwhile, an Indian mill floated a tender for empanelled customers.
  
  

Coal

• Premium HCC prices fell by $44/t w-o-w. The price on 8 July stood at $258/t FOB Australia and $282/t CNF India. The fall was due to weak steel demand as manufacturers made need-based purchases and were waiting for prices to stablise.
  
  
• Portside RB3 (4800 NAR) prices remained higher at INR 16,000/t at Gangavaram Port this week amid strong demand. RB2 prices were also assessed higher at INR 18,200/t.
  
  
• South African RB1 prices rose by $13/t w-o-w at $355/t FOB amid rising procurement demand from Europe ahead of the Russian sanction deadline.
  
  

Ferrous scrap

India's imported scrap offers picked up after the recently concluded deals to Turkiye. Steel producers have limited stocks available at mills. Buyers preferred imported material over domestic due to cost competitiveness. Active deals took place, especially in Nhava Sheva and Mundra ports. Meanwhile, buyers preferred to book from nearby regions for immediate delivery and less risk for currency exchange rate.

• SteelMint's assessment of Europe-origin shredded scrap prices stood at $480-485/t CFR Nhava Sheva, up $25-30/t w-o-w
  
  
• UAE origin HMS 1 offers at $495-500/t CFR.
  
  

Ferro alloys

• Silico manganese (60-14 grade) export prices were down by $20/t w-o-w to $1,060/t and those for 65-16 grade were lower by $25/t w-o-w to $1,180/t at Indian ports amid muted demand. Meanwhile, domestic silico manganese (60-14) prices dropped w-o-w to INR 81,300 /t ex-Durgapur (down INR 2,620/t), INR 82,480/t ex-Vizag (down INR 1,660/t) and INR 83,000/t ex-Raipur (down INR 1,690/t).
  
  
• Ferro manganese export prices were stable as demand continues to remain muted in the domestic as well as export market. The weekly average prices for HC 70% were stable at $1,110/t, while there was nominal drop of $ 4/t w-o-w for HC 75% grade to $1,206/t. Meanwhile, domestic ferro manganese (HC70%) prices were down marginally w-o-w by INR 600/t to INR 86,240/t ex-Durgapur and INR 87,460/t ex-Raipur.
  
  
• According to SteelMint's assessment on 7 June, ferro chrome (HC60%) prices were at around INR 106,700/t exw-Jajpur, dropping by around INR 1,000/tonne (t) w-o-w amid selling pressure from weak domestic and export markets.
  
  
• Indian ferro silicon (70%) prices inched up by around INR 3,750/t w-o-w as buyers accepted higher prices pushing producers to keep offers high. According to SteelMint's assessment on 8 July, ferro silicon prices hovered at around INR 150,000/t both exw-Guwahati and -Bhutan.
  
  

Semi-finished

Indian semi-finished steel prices increased sharply on the week, as per SteelMint assessment. Billet offers rose in the range of INR 500-3,100/t across regions. Similarly, sponge iron prices rose INR 500-2,100/t w-o-w amidst active demand and seasonal slight supply shortage of sponge iron.

• SAIL conducted an auction for 2,000 t of steel grade pig iron on 4 July from IISCO Steel Plant in Burnpur. Buyers booked the entire quantity at a weighted average price of INR 44,500/t exw.
  
  
• SAIL held an auction for 1,000 t of basic grade pig iron on 5 July from Rourkela Steel Plant (RSP). However, buyers showed no interest due to the higher base price at INR 45,800 exw.
  
  
• SAIL held an auction for 4,000 t of steel grade pig iron on 8 July from Durgapur Steel Plant. Buyers booked the entire quantity at a weighted average price of INR 46,400/t exw, higher by INR 2,175/t compared to previous auction.
  
  
• About 10,000 t of sponge iron export deals were reported this week, while current offers hovered around $480-485/t CPT Nepal for FeM 79-80% material (70% lump and 30% fines).
  
  
• IF-route billet export offers rose $25-30/t w-o-w to around $645-650/t exw-Durgapur, equivalent to $670-675/t CPT Nepal. Demand remains poor due to slow domestic finished steel demand and low offers for BF-route billets.
  
  
• Two to three rakes (5,000-7,500 t) of BF-route billet export deals from eastern India-based mills were concluded this week to Nepal at an average price of $640-645/t CPT Nepal.
  
  
• Spot steel grade pig iron prices rose by INR 300-1,400/t, with a major hike of INR 1,000-1,400/t noticed in the central and eastern regions due to the rally in billet prices.
  
  

Finished long

India's induction furnace-route finished long steel market saw moderate trade throughout the week. The sharp hike in raw material costs pushed suppliers to raise their offers on w-o-w basis. On the other side, the rise in power costs by Maharashtra (MSEDCL) and West Bengal (WBERC-DVC) electricity boards will increase the production costs. Also, rebar gauge parity has been increased for specific sizes of rebar in Durgapur market. Along with all these above scenarios in most of the markets, manufacturers have adequate future booking orders in their hand and it's less likely to any major downfall in near term.

• On a weekly basis, rebar prices rose by INR 600-1,800/t w-o-w in most markets but a sharp hike of INR 2,500/t was recorded in Durgapur, 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 53,900-54,300/t exw-Raipur and INR 56,300-56,700/t exw-Jalna.
  
  
• Blast furnace (BF)-route rebar prices remained flat w-o-w on the back of limited buying interest from end-users. Current BF-route rebar (12-32mm, Fe500D) prices are assessed at around INR 58,500-59,500/t exy-Mumbai, excluding GST at 18%. Trade channel checks are anticipating prices to move up in a couple of days due to the spike in the secondary market.
  
  
• Trade discounts given by Raipur-based heavy structural steel manufacturers were at INR 1,500/t. Trade reference price of 200 mm angles stood at INR 59,100-59,500/t exw-Raipur.
  
  
• Trade discounts given by Raipur-based wire rod suppliers was at INR 500-700/t and trade reference prices stood at INR 54,800-55,200/t exw Raipur and INR 55,800-56,000/t exw Durgapur, size 5.5 mm.
  
  

Finished flat

• The domestic trade market prices of flat steel products witnessed mixed trends this week.
  
  
• Prices of HRC and CRC dropped marginally while those of plates remained range bound. Meanwhile, there was a slight increase in prices of value-added coated flat steel products.
  
  
• "Steady buying by end-users in low volumes over the past couple of months and limited interest in building up inventories by distribution network participants lent some support to prices," sources informed. This form of procurement cycle was driven by the continual decline in product prices.
  
  
• Moreover, flat steel manufacturers also reduced prices m-o-m for early-July sales this week.
  
  
• On the exports front, SteelMint's India HRC (SAE1006, boron added) export index dropped by another $15/t this week to $645/t FOB east coast. Low buying interest for boron added HRCs continued to pose challenges for mills to conclude deals in Europe and UAE. However, some volumes were booked for exports to Vietnam some 7-10 days back. Mills have been finding it difficult to book bulk HRC exports orders since March and scouting the markets with reduced offers since April this year.