Insight Details
Weekly: Indian steel market snapshot
Semi Finished
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21 Nov 2020, 17:07 IST
Weekly: Indian steel market snapshot

Indian spot steel trades in the secondary market remained supportive during week 47, however later on towards the weekend, the market has registered a slight price correction. As per SteelMint's assessment, the semi-finished market sentiments have improved with domestic sponge iron & billet offers increased by INR 200-2,000/t, w-o-w.

Also, the finished long steel - rebar prices of mid-sized mills observed a sharp hike of INR 600-2,500/t w-o-w basis in most of the locations.

Sources are of the opinion that factors like - Odisha HC hearing on stock liquidation and domestic iron ore market scenario will influence the semi-finished market next week.

Iron Ore & Pellets

  • NMDC has announced the 2nd price hike of iron ore for this month. Prices have increased further upto 11%. The miner has raised the price for Baila fines and lump by INR 300 and INR 400 respectively while that of DR CLO by INR 460/t. SAIL has concluded 28,000 t iron ore fines (Fe 60.2%) auction from its Rajhara mines in Chhattisgarh at INR 4,170/t (Loaded into rakes and including royalty).

  • Odisha's Serajuddin mines resumed iron ore offers. Essel Mining has hiked iron ore offers twice in a week around INR 1,500/t for fines and INR 800/t for lumps amid acute shortage.

  • SteelMint's bi-weekly domestic pellet index "PELLEX" has increased by around INR 1,400/t to INR 11,800/t, DAP Raipur in the recent hike and deals. Pellet prices like Bellary has increased offer further w-o-w by around INR 700-800/t amid hike in sponge offers. However, in other regions prices are mostly stable.

  • SteelMint's pellet export index (FOB east coast India) has increased by $4/t on a weekly basis and stands at $136/t on 18th Nov'20. Pellet export index has increased as demand for pellet is increasing gradually in China amid falling pellet inventories at Chinese ports. Not many active export offers were heard from India this week too amid getting high realization in the domestic market.

Coal

  • Australian coking coal prices continued declining this week amid oversupply concerns arising from subdued buying interest in Asian markets excluding China.

  • However, strong demand for non-Australian coals exists in the Chinese market following the country's informal import ban.

  • China delivered prices have risen to an eight month-high on fresh bookings concluded in the premium low-volatile segment and limited availability of non-Australian cargoes.

  • As Chinese end users have become obliged to import coking coal from countries such as Canada and the US, Australian premium hard coking coal prices came under selling pressure.

  • Spot demand in Southeast Asian markets remained weak, with ex-Chinese buyers including Indians staying on the sidelines in hopes that offers could fall further.

  • Latest offers for the Premium HCC grade are assessed at around $97.25/t FOB Australia, $165.50/t CNF China and $109.80/t CNF India.

Ferrous Scrap

  • Imported scrap prices in India strengthened further this week. Global price hike on supply tightness and increased freight rates remained the major factors behind surge in offers. Notably, the prices have reached to two years high as the same levels were recorded during Nov'18.

  • A major Indian steel mill has booked 8,000 t of imported scrap in containers this week, sources have shared to SteelMint. The cargo comprises, 4,000 t of shredded scrap from different origins (US, Australia, and New Zealand) at $360/t CFR Mundra and 4,000 t of bundles at $380/t CFR Vizag basis.

  • SteelMint's assessment for Shredded scrap in containers of UK/EU origin stands at $360/t CFR Nhava Sheva, moving up significantly by $20 w-o-w.

  • Market has remained optimistic as other domestic raw materials like sponge iron, iron ore, and domestic scrap prices have moved up further this week, highlighted by source.

Semi Finished

On a weekly basis, Indian Semis market showed improvement, in which domestic Sponge iron up by INR 800-1,600/t & billet offers surge by INR 300-2,000/t.

  • SAIL IISCO Steel Plant conducted an auction for 1,000 t OG (basic) grade pig iron on 19th Nov. Buyers booked entire offered quantity at a weighted price of INR 30,030/t exw.

  • Vedanta Limited has increased its offer for foundry grade pig iron by INR 700/t w.e.f 19th Nov. Current offer for the same stands at INR 35,700/t DAP Gujarat.

  • SAIL Rourkela Steel Plant conducted an auction for 6,400 t steel grade pig iron on 18th Nov. Out of total quantity, buyers booked 6,300 t at a weighted price of INR 29,760/t exw.

  • SAIL is going to conduct an auction for 15,000 t prime steel grade pig iron from Bhilai Steel Plant, Chattisgarh. The auction is scheduled on 23 Nov'20.

  • Indian sponge iron export offers increased by $20-25/t in a week to $360/t CPT Benapole, equivalent to $375/t CFR Chittagong, Bangladesh. Total of around 15,000 t deals reported to Bangladesh this week.

  • Induction grade billet export offers surged by $20-25/t to $470-475/t exw Durgapur, equivalent to $495-500/t CPT Nepal. As per suppliers, sufficient orders have been received on increased price range.

  • Steel grade pig iron prices rally by INR 200-1,000/t with a major hike of INR 800-1,000/t in north-east India due to surge in sponge iron & billet prices, however demand remained average as per private pig iron producers.

Finished longs

India's finished long steel market of mid-sized mills observed a huge spike in prices by INR 1,200-2,400/t w-o-w basis, in most of the major supplying locations, except in Gujarat market where prices increased up to INR 500/t. Active demand, decent trade activity in major markets along with rapidly increasing raw material cost have led to increased the long steel prices as SteelMint learned from trade sources.

  • Trade reference rebar prices (12-25 mm) through midsized mills assessed at INR 37,200-37,400/t exw Raipur, INR 40,000- 40,300/t exw-Jalna, INR 39,800-40,200/t exw Chennai.

  • Trade discount given by Raipur based heavy structure manufacturers is maintained at INR 700-1,000/t and the trade price of 200 Angle assessed at INR 40,900-41,300/t exw.

  • Trade discounts in Raipur wire rod is currently at INR 1,100-1,300/t and trade reference price stood at INR 38,000-38,600/t exw Raipur, INR 38,500-39,000 exw Durgapur, size 5.5 mm.

  • Mid scale mills wire rod export offers moved up by $20-25/t to $525-530/t exw Durgapur, equivalent to $550-555/t CPT Nepal.

Finished Flats

  • Major Indian steel mills have announced a second price hike in Nov'20 by INR 750-1000/t on the back of higher iron ore prices and improved demand in domestic trade markets. After hike, mills are offering HRC (IS 2062 2.5-8 mm) around INR 45,000-45,150/t and CRC (0.9mm, IS 513) at INR 54,000/t (exy Mumbai). Prices do not include GST extra @18%.

  • In the beginning of the month integrated steel mills have announced a steep hike in list prices of HRC and CRC prices by INR 1,000-1,250/t for November deliveries due to improved auto demand along with short supply hovering in the trade market.

Prices in trade segment:

  • On the other hand, SteelMint's benchmark price for HRC (IS2062 2.5-8 mm) stood at INR 47,500 /t (exy Mumbai) and CRC (0.9 mm GR) is around INR INR 54,500-55,000/t (exy Mumbai). Prices do not include GST extra @18%.

  • Tight supplies and improved traders will continue to drive domestic HRC and CRC prices in the trade segment. Meanwhile, market sources shared that Nov - March is considered to be the peak season for Indian steel sector. In addition to this, mills are likely to further increase prices in the beginning of Dec'20.

Reference Prices as on 21st Nov'20 (Week 47)
Prices are exw & exclusive of GST

Indian export reference prices as on 21st Nov'20
Prices in $/t
Source: SteelMint Research

 

21 Nov 2020, 17:07 IST

 

 

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