Posted on 25 Apr 2022
Weekly round-up: Domestic semi-finished, flat steel market sink on prevailing high prices
The domestic steel market saw prices edging lower during week 17 (18-23 Apr’22). Semi-finished steel prices fell in the range of INR 200-1,500/tonne (t).
Domestic induction furnace finished long steel offers edged down in the range of INR 500-1,000/t w-o-w. The trade reference prices for finished flat products fell in the range of INR 400-2,400/t for HRC and CRC.
Iron ore and pellets
- SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 11,600/tonne (t) DAP Raipur on 22 Apr, down INR 500/t compared with the last assessment on 19 Apr. Drop in offers effected by the Raipur- and Odisha-based players along with the fall in sponge iron prices have weighed down pellet prices.
- China’s National Development and Reform Commission’s (NDRC’s) checks and steel output cuts continued to weigh on sentiments in India’s pellet export market. India’s pellet (Fe 63%, 3% Al) export index FOB east coast fell $3/t w-o-w to $158/t on 20 Apr from $161/t on 13 Apr.
- NMDC will auction 168,000 t of iron ore from Chhattisgarh on 28 Apr.
- India’s iron ore export prices remained supported this week. However, deals remained subdued as Chinese mills are awaiting clarity on NDRC checks amid the rise in COVID-19 cases. SteelMint’s weekly index for India’s low-grade iron ore fines (Fe 57%) exports stood at $61/t FOB east coast, inching up $1/t w-o-w.
Coal
- Australian premium low-volatile hard coking coal prices remained volatile this week and saw a net fall of $57/t w-o-w amid indications of improved supplies. Latest prices for remium HCC grade are assessed at around $449/t FOB Australia and $476/t CNF India.
- Portside RB2 (5500 kcal/kg NAR) coal prices remained firm at INR 22,000/t at Gangavaram Port amid elevated imported coal prices and limited vessel arrivals from South Africa. South African RB1 prices for Apr saw a modest rise of $5/t w-o-w to $314/t FOB amid strong buying sentiment and force majeure at Richards Bay coal railings.
Ferrous Scrap
- India’s imported scrap trade remained slow despite the fall in offers. However, a few deals for UAE-origin and West Africa-origin HMS were observed at lower offers. Although domestic steel prices dropped w-o-w, they remained volatile throughout the week. Steel production cuts amidst power outages have also kept mills inactive with regard to scrap import bookings.
- Fresh offers for UK/EU-origin shredded are being quoted at $640-645/t CFR Nhava Sheva, down further by $5/t w-o-w. Small quantities have been booked at $650/t CFR basis earlier in the week.
- Dubai-origin HMS1 has been booked at $580-582/t in the second half of the week, while 1,000 t of HMS 1 was booked at $590/t earlier in the week.
Other western India-based steel mills procured 1,000 t UAE HMS 1&2 (80:20) at $570-575/t. - A few more deals for PNS and fabrication material from the UAE have been booked this week. Mills are looking for short sea distance cargo from Mauritius, Yemen, and West Africa, considering the short delivery period and cost-effectiveness.
Ferro Alloys
- The ferro alloys market in India saw mixed trends as manganese alloys and ferro silicon prices dropped due to weak demand and selling pressure, while ferro chrome prices increased slightly due to rising production costs.
- Domestic silico manganese (60-14) prices dropped INR 2,000-2,100/t w-o-w on selling pressure. According to SteelMint’s assessment on 22 Apr, silico manganese prices are hovering around INR 101,500-103,500/t exw-Durgapur and Raipur.
- Prices for ferro manganese (HC70%) in India dropped by INR 2,200-2,700/t w-o-w as producers tried to increase buying interest by lowering their offers. On 22 Apr, the market price for HC70% grade was around INR 104,600-107,000/t exw from Durgapur and Raipur.
- Indian ferro chrome (HC60%) prices increased due to high production costs stemming from surging chrome ore prices worldwide despite low demand. Ferro chrome (HC60%) pries inched up by INR 1,200/t w-o-w to INR 121,000/t exw Jajpur, assessed on 21 Apr.
- Indian ferro silicon (70%) prices fell by around INR 10,500/t w-o-w to INR 160,000/t ex-Guwahati as low demand at higher offers combined with lackluster stainless steel sentiment. Bhutan’s producers were offering at around INR 163,000- 165,000/t exw, assessed on 22 Apr.
Semi-finished steel
Indian semi-finished steel prices remained volatile. Domestic billet prices fell by INR 300-1,500/t across regions, with the major fall seen in Ahmedabad and Chennai. Sponge iron prices fluctuated in the range of INR 200-1,400/t.
- Induction furnace (IF) route billet (produced by the mid-sized plants) offers were reported at $740/t exw-Durgapur, equivalent to $765/t CPT Nepal, down $15/t, w-o-w.
- SAIL held an auction for 4,000 t of steel grade pig iron on 20 Apr from Bokaro Steel Plant (BSL). Buyers booked the entire quantity at a weighted average price of INR 59,000/t exw.
- Indian sponge iron export offers are at $545/t CPT Raxaul.
- Vizag steel floated an ocean sale export tender for 10,000 t of steel billet (90x90mm, C20MMn Gr. A) on FOB ST. delivery basis against irrevocable letter of credit on payment at sight basis. The due date is 27 Apr and the shipment is scheduled for 10 Jun.
- Electrosteel conducted an auction for 1,500 t of steel grade pig iron on 19 Apr, which was concluded at INR 60,700-61,000/t ex-plant.
- SAIL held an auction for 4,800 t of basic pig iron (in 48 units) on 21 Apr from RSP in Odisha. Buyers booked 43 units at a weighted average price of INR 59,800/t exw.
Finished Long
- India’s finished long steel market catered to by induction furnace steel producers observed weak buying enquiries and trades this week across regions. In major markets, manufacturers of TMT had noticed traders booking limited quantity on higher prices which lowered bulk trading activity. However, on the basis of previous booking orders and movement of raw material prices, producers adjusted prices and/or offered tradable discounts as per requirements. However, discounts varied across regions.
- On a weekly basis, rebar prices witnessed a mixed trends across regions and fluctuated in the range of INR 500-1,000/t w-o-w in most major markets, SteelMint assessment shows.
- The trade reference price of Fe 500 grade rebar manufactured via the IF route for 10-25mm size was assessed at INR 61,000-61,400/t exw Raipur, INR 63,900-64,300/t exw Jalna.
- Trade discounts given by Raipur-based heavy structural steel manufacturers were at around INR 1,000/t and the trade reference price of 200mm angle stood at INR 65,700-66,100/t exw Raipur.
- Trade reference prices for steel wire rod stood at INR 60,300-60,500/t exw Durgapur, size 5.5 mm.
Finished Flat
- Decline in overseas trades offers, and the continual weak end-user industrial demand in the domestic market weighed further on the trade prices across categories. Thus the distributors and traders were forced to reduce their offer levels further this week to incite buying interest. Moreover, distribution network participants are anticipating mills to provide some relief in the form of discount or rebates to boost trade activities in the market.
- On the exports front, offers in the EU market for HRC (S275) dropped to $1,130-1,150/t CFR (down $35/t w-o-w), that to UAE to $980-1,000/t ($85/t) for June month deliveries. Buying interest for imported HRCs have been impacted by availability of cheaper alternatives in UAE, while issues around opening up of LCs in the EU market. This has kept the inquiries low from these regions. Also, with a decline of $70/t this week, SteelMint’s HRC (SAE1006) export index stood around $940/t FOB east coast India.
Source:SteelMint
