SteelMint: India's domestic steel scrap index marginally down by INR 200/t
SteelMint’s domestic steel scrap (end-cutting) index decreased slightly by INR 200/tonne (t) to INR 41,200/t DAP Mandi Gobindgarh. Average movement in finished st...
SteelMint's domestic steel scrap (end-cutting) index decreased slightly by INR 200/tonne (t) to INR 41,200/t DAP Mandi Gobindgarh.
Average movement in finished steel, specifically in rebar and pipes, because of production utilisation saw nominal changes on a d-o-d basis.
The factor attributed to the fluctuations is a minor shortfall in scrap since the last few days which is preventing a sharp correction despite a narrowing conversion spread from melting scrap to semi-finished.
Induction furnace units have adjusted their margins by INR 200-400/t and bids have been placed on availability in the north region.
Further, imported scrap offers are too high to consider at the moment with HMS 80:20 of Middle East origin currently hovering at $495-500/t which translates into a landed cost of INR 40,500-41,000/t DAP against domestic scrap at INR 37,400-37,600/t.
Some market participants feel minor corrections may happen in the near term considering the festive mood whereas others expect prices to stay range-bound, SteelMint notes.
Today, 11 sets of trades, indicative prices/bids/offers were recorded in the publishing window.
The Index also derives the HMS 80:20 scrap (Heavy, Med), and CR Sheet cutting prices traded in the region.
Scrap Grade and Spread Calculation: (Mandi Gobindgarh)
Prices in INR/t, DAP (Delivered at Plant)
To see SteelMint's Melting Scrap Assessment, pricing methodology and specification documents, Click here
What is SteelMint Indian scrap index - SteelMint's assessment of Mandi scrap reflects the prices of different melting HMS grade generated and traded in the domestic market. SteelMint gathers and verifies information from buyers and sellers active in the physical spot market. The data obtained by SteelMint, are normalized for yield, dimensions, density, location and other terms of trade to the specifications.
Why this index? India's National Steel Recycling policy mentioned that the efficient use of scrap for steel production becomes very crucial for India as 35-40% share has been envisaged from scrap-based steel production in the journey of 300 mn t pa by 2030. This shall increase the requirement of steel scrap sharply from the present level of around 30 mn t.
Methodology - Market data, including deals, bids, and offers that meet the delivery and quality criteria are considered for price assessments. The highest importance in the price calculation process is assigned to confirmed deals (T1) where either a buyer or seller has provided details of the transaction. Deals of only reputed and trustworthy producers and trading firms are included in the price collection and calculation process. Indicative prices, confirmed bids and offers are also considered valuable for the pricing process (T2). The index has been calculated using an average of T1 and T2 price inputs.
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