Weekly round-up: Semis market sees sustained momentum while flat steel prices edge lower

The domestic steel market saw an uptrend in prices during week 26 ( 20 Jun- 25 Jun'22). Semi-finished steel prices rose in the range of INR 200-2,500/tonne (t).

Domestic induction furnace finished long steel offers inched up to INR 1,500/t w-o-w. Trade reference prices for finished flats (HRC and CRC) fell in the range of INR 100-2,500/t for .

Iron ore and pellets

• SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 7,700/tonne (t) DAP Raipur on 24 June, up by around INR 250/t compared to the last assessment on 21 June. Around 54,000 t of pellet (Fe 62/Fe63) deals were heard in this publishing window at around INR 7,600-7,950/t DAP Raipur.
  
  
• Odisha Mining Corporation (OMC) had scheduled an iron ore fines auction on 23 June in which out of a total of 1.55 mnt of material only 89,000 t (less than 6%) received bids. The bid prices in today's auction fell up to INR 350/t as against last month's bid price. In Odisha Mining Corporation's (OMC) iron ore lumps auction, out of a total of 1.22 mnt of material on offer only 77,000 t (6%) received bids. The bid prices fell up to INR 500/t as against last month's bid price.
  
  
• India's iron ore export market turned silent this week as prices in China dropped recently, showing a correction of $20/t w-o-w. Market indications for Indian-origin low-grade fines of Fe 57% were at $65/t CFR China.
  
  

Coal

• Australian coking coal prices fell $28/t w-o-w basis due to low buying interest amid weak steel prices. The price for premium HCC is assessed at $350/t FOB Australia and $377/t CNF India.
  
  
• In thermal coal portside RB3 (4800 NAR) prices rose by INR 1,000/t this week to INR 15,000/t at Vizag Port amid a sharp rise in imported coal prices and improving demand from sponge iron manufacturers in procuring low-CV coal. RB2 offers, however, remained stable at INR 18,000/t.
  
  
• South African RB1 prices rose by $33/t w-o-w at $355/t FOB amid rising procurement demand from Europe as Russia tightened its gas supplies.
  
  

Ferrous Scrap

• Indian imported scrap buyers returned to bulk cargo within a week as offers fell in another round of bookings. Three bulk cargoes comprising 40,000 t each carried mixed material was booked from the USA and Europe based suppliers. The cargo was booked at an average price of $395-400/t CFR Chennai and $415/t CFR kandla basis respectively.
  
  
• Steel mills were mostly active in booking bulk cargoes as offers fell. However containerised booking remained slow.
  
  
• SteelMint's assessment for UK-origin containerised shredded scrap stands at $435/t CFR levels, down by $50/t w-o-w
  
  
• Dubai origin HMS 1 being offered at $435-440/t, down by $28/t w-o-w.
  
  

Ferro Alloys

• Silico manganese (60-14) prices in India increased marginally amid moderate demand. SteelMint estimates on 24 June show that silico manganese prices rose by INR 3,520/t to INR 84,500/t ex-Raipur, by INR 4,320/t to INR 84,000/t ex- Durgapur, and by INR 4,570/t to INR 84,000/t ex-Vizag on a weekly basis.
  
  
• In India, ferro manganese (HC70%) prices remained rangebound for Durgapur and Raipur; prices fluctuated w-o-w but market was stable amid low demand. Prices for ferro manganese on 24 June were between INR 86,400/t ex- Durgapur and INR 86,600/t ex- Raipur.
  
  
• Indian ferro chrome (HC60%) prices remained rangebound w-o-w with marginal hike as producers tried to push up prices to net some profit. According to SteelMint's assessment on 23 June, ferro chrome (HC60%) prices were at around INR 108,000/t exw-Jajpur.
  
  
• Indian ferro silicon (HC70%) prices surged around INR 16,000/t w-o-w owing to supply-demand mismatch. According to SteelMint's assessment on 24 June, ferro silicon prices were hovering around INR 150,000/t exw- Guwahati and Bhutan.
  
  

Semi-finished Steel

Indian semi-finished steel prices increased, as per SteelMint assessment. Domestic billet prices increased by INR 200-2,500/t across regions, with a major increase of INR 2,500/t in Chennai. Similarly, sponge iron prices rose INR 200-1,250/t w-o-w.

• SAIL has floated an ocean sale export tender for 18,900 t of prime mild steel non-alloy concast billet (125x125x9000/12000 mm, 4SP/5SP). The due date for the tender is 27 June'22 and the delivery is scheduled for 31 August.
  
  
• At SAIL's 4,000 t steel grade pig iron auction on 22 Jun'22 from Bokaro Steel Plant (BSL), buyers booked the entire quantity at INR 44,000/t exw. Another auction on the same day from the Rourkela Steel Plant for 1,600 t of pig iron closed without a single bid being placed due to the high base price of INR 46,300/t
  
  
• Tata Metaliks Ltd. has reduced pig iron prices by INR 3,000/t ($38). Fresh offers for foundry grade are at INR 51,700/t and basic grade at INR 48,000/t. Prices are exw Kharagpur, applicable for Kolkata and Howrah.
  
  
• JSW Ispat Special Products Limited has preponed the planned maintenance shutdown of its blast furnace, sinter plant and steel melting shop in Raigarh and two furnaces of ferro alloys and an SMS in Raipur. The maintenance works started from 21 June 2022 for 25 days.
  
  
• About 2,500 t of sponge iron export deals were reported this week at a price range of $430-435/t CPT Nepal for FeM 79-80% material (70% lump and 30% fines).
  
  
• Sponge iron export offers to Bangladesh increased by $15/t to $395/t CPT Benapole. Demand remains weak due to surging offers amidst seasonal weak domestic finished steel demand in Bangladesh.
  
  
• About 5,000 t of IF-route billet deals were reported at around $585-595/t exw Durgapur, equivalent to $610-620/t CPT Nepal.
  
  
• Also, three to four rakes (8,000-10,000 t) of BF-route billet export deals from eastern India -based mills were concluded this week to Nepal at an average price of $635-640/t CPT Nepal.
  
  
• Spot steel grade pig iron prices rose by INR 400-1,100/t due to a surge in billet prices. However, no fresh allocations or deals for exports due to less realizations.
  
  

Finished Long

India's finished long steel market of induction furnace route observed mixed trends in terms of trades and transactions throughout the week which varies a region wise. In the central region, moderate trades were observed, but due to adjusted productions by mills and delay in dispatch and deliveries supported manufacturers to kept prices remain high.

In other regions suppliers have noticed a average demand on daily basis in the spot market and they won't have any sale pressure because inventories are not much pile up in their yard, while in terms of prices they adjusted tradable discounts and offers as per the movement of steel billet and raw material (melting scrap and sponge iron) prices in the key markets.

• On a weekly basis, prices in rebar steel surged up to INR 1,500/t w-o-w in most of the markets. However in few markets of north & western region (Ahmedabad) marginal fall in prices are also observed by up to INR 300/t as 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 51,300-51,700 INR /t exw Raipur, INR 54,200-54,600/t exw Jalna.
  
  
• Trade discount given by Raipur- based heavy structural steel manufacturers is around INR 1,200-1,500/t and trade reference price of 200 mm angles stood at INR 56,800-57,300/t exw Raipur.
  
  
• Trade discounts given by Raipur- based wire rod suppliers are around INR 800/t and trade reference prices stood at INR 52,600-53,100/t exw Raipur, INR 53,000-53,200/t exw Durgapur, size 5.5 mm.
  
  

Finished Flat

• Trade market prices of finished flat steel products continued to decline this week though the quantum was less than those in the previous few weeks. A notable point- the trade market prices of hot-rolled (HR) coils and plates have come down to over-one-year low, matching levels last seen in early April 2021.
  
  
• Active bargaining by end-buyers, and purchases on need basis has been the major bone of contention for the distributors and retailers. Thus, the slow outflow of materials from the distribution channel has kept the participants away from stocking in bulk quantities. Untimately leading to lean inventory with both end-buyers and distributors.
  
  
• "End-buyers and seller in the distribution channel are not interested in building up stocks. Avoiding losses amid the continual declining prices and the prevailing bearishness in the market, remains the leading reason," sources informed SteelMint.
  
  
• Moreover, with the month-end closing in, distribution network participants are looking forward to the price announcement from mills for July month deliveries now.
  
  
• On the exports front, Indian steel majors continue to face difficulties in concluding deals for boron-added HRCs. However, a private Indian steel major was heard to have booked 30,000 t of HRCs (boron-added) for exports to the EU last week. The deal was concluded at Euro 745/t (translating to $786/t) CFR for July shipment. However, it could not be confirmed till the time of publishing this report.
  
  
• SteelMint's India HRC (SAE1006) export index was assessed further low at $700/t FOB east coast India, contrasted against $723/t FOB a week ago. No deals were heard concluded for the markets of UAE and Vietnam this week.