Monthly Archives: March 2014

Mill Scale

Indian Exporters raise Mill Scale Offers to USD 120-122/MT CFR China

Rise in spot Iron ore prices due to some hope of recovery in Chinese economy has supported offers of Mill Scale from Indian exporters. Spot Iron ore rose sharply by almost USD 3-4/MT on Monday afternoon. Australian PB fines was traded at over USD 115/MT and Australian 62% was offered above USD 117/MT CFR China. Brazilian 65% fines sold at USD 125/MT CFR China.

On the same line, Indian exporters have raised their Mill Scale offers to USD 120-122/MT CFR China (in Bulk), which was at around USD 115/MT CFR last week.

In Indian domestic market, last deal of 1,000 MT Mill Scale of grade 70/68 was heard settled at INR 5,400/MT delivered Vizag port. Looking at such sharp rise, market is anticipating of price hike in the domestic market as well.

 “Current offers are at above at USD 120/MT CFR China, however looking at momentum in the market, we will wait & watch”, said a Mill Scale exporter based in Eastern India.

Mill scale is a by-product generated during re-rolling process and generally used by the Pellet manufacturers and Blast furnace operators. Indian mill scale exports increased recently as there is no export duty or differential freight charge on it, unlike Iron ore.

India had exported around 1.2 MnT Mill Scale during FY13, in which most of the shipments were made from Kandla followed by Vizag.

 

India: MSTC auctions for Sale of Iron Ore

Metal Scrap Trade Corporation (MSTC) invites bid for sale of Iron ore from different Iron ore mines/stockyard at Karnataka.

The e-auction is for registered Steel, Pig iron, Pelletisation, Sponge iron and Beneficiation plants which have been wholly/partly dependent on Iron ore from Karnataka for their own use.

The two auctions are scheduled on the same day that’s on 04 Apr, 2014. The other two will be held on 07 Apr & 08 Apr, 2014 respectively.

Auction 1

  • Iron ore lumps: 116,700 MT
  • Iron ore fines: 748,000 MT
  • Total quantity: 864,700 MT

Bid opening time: 11.00  hrs on 04 Apr, 2014
Bid submission due date: Before 10.00 hrs on 04 Apr, 2014

Auction 2

  • Iron ore fines: 680,000 MT
  • Total quantity: 680,000 MT

Bid opening time: 13.00 hrs on 04 Apr, 2014
Bid submission due date: Before 10.00 hrs on 04 Apr, 2014

 Auction 3

  • Iron ore lumps: 196,000 MT
  • Iron ore fines: 160,000 MT
  • Total quantity: 356,000 MT

Bid opening time: 15.00 hrs on 07 Apr, 2014
Bid submission due date: Before 14.00 hrs on 07 Apr, 2014

 Auction 4 (Advanced)

Advance Iron ore e-auction for Donimalai Mines in the state of Karnataka will be held on 08 Apr, 2014. The total quantity of Iron ore offered for sale in e-auction is 384,000 MT. 

  • Iron ore lumps: 184,000 MT, Fe%: 62, Moisture: 4-6%, Undersize: Upto 15%
  • Iron ore fines: 200,000 MT, Fe%: 60, Moisture: 6-8%

Week 1-4 (15 Apr-05 May’14) 

  • Iron ore lumps: 184,000 MT
  • Iron ore fines: 200,000 MT

Bid opening time: 15.00 hrs on 08 Apr, 2014
Bid submission due date: Before 14.00 hrs on 08 Apr, 2014

Royalty, Forest Development Tax, Sales tax, Cess and other statutory duties & levies etc applicable at the time of supplies will be extra and payable by the successful bidder.

 

India: High Carbon Ferro Chrome Market Stable; Trade thin

High Carbon Ferro Chrome market remained quiet as same last week, with sluggish demand and very low trade volumes.

High Carbon Ferro Chrome market remains static on sparse demand. Current prices for HC Ferro Chrome (60% grade) is hovering at around INR 69,500-70,000/MT (Ex-works Odisha). In Raigarh, prices stand at INR 71,000/MT. With the financial year-end there is less demand for the material. Demand in the overseas market also remained lull.

“Demand has been limited and there has been no real activity for such a long period,” remarked a trader from Odisha.

OMC Chrome Ore Auction

Odisha Mining Corporation (OMC) is conducting e-auction for sale of 62,000 MT of Chrome ore of different grades produced at South Kaliapani Chromite Mines and Sukrangi Chromite Mines of OMC in the Sukinda valley. Also, different grade of Chrome concentrate produced in COB Plant of OMC located within South Kaliapani lease in the district of Jajpur, Odisha. The break-up of the quantity has not yet been decided as it would be finalized by 02 Apr, 2014. The e-auction shall be held by MSTC on 07 Mar, 2014.

Chinese Market

Price of Indian-origin High Carbon Ferro Chrome (58-60% Cr) at 83-85 cents/lb CIF China Friday, and South African charge Chrome (48-52% Cr) at 83-84 cents/lb CIF China. Both prices were unchanged on the week as a standoff between buyers & sellers continued.

Suppliers were reluctant to drop prices, saying they were close to, if not at breakeven levels, while buyers were seeking lower prices or refraining from importing.

A trader from India reported, “Chinese buyers are not interested in buying now as demand is not very good and may worsen with stainless production cuts.”

China’s domestic prices of High Carbon Ferro Chrome (50% basis Cr) were at RMB 6,700-6,900/MT (82.5-85 cents/lb) delivered, with 17% value added tax. The prices were unchanged W-o-W. Other than a depreciating RMB against the US dollar, Chinese buyers were also holding off and waiting for major Chinese stainless steelmakers to set their April purchase price. It is being expected that steelmakers to cut their April prices.

Japanese Market

Price of High-Carbon Ferro Chrome (62-65% Cr) offered to Japan stand at 88-89 cents/lb CIF unchanged from last week, amid slack trade as participants awaited the results of second quarter term negotiations.

Indian producers said that their price indications remained unchanged from earlier in the month amid lack of any market-moving developments

On the future outlook, market watchers are expecting the market to get better after mid April, until then prices are expected to remain steady.

Exchange Rate: USD 1=INR 59.92

 
Coal Stock

Weekly Coal Stock at Indian Ports fell by 6.3%

Combined Coal stock (Coking, Non-coking & Anthracite) at major Indian ports stood at 7.7 MnT which had declined by 6.3% during the week ended on 29 Mar, 2014 (23-29 Mar, 2014).

During the end of week, 16 Indian ports had stock around 1.7 MnT of Coking Coal, 3.7% more than previous week and Non-coking Coal stock at Indian ports declined by 8.2% to around 5.9 MnT, accessed by SteelMint.

Around 14,000 MT of Anthracite stock laid at Paradip port belongs to Balasore Alloys, Rawmet & IMFA. Krishnapatnam port has around 6,500 MT of Pet Coke, imported by Bharathi Cement from USA.

Krishnapatnam port on the East Coast of India had the highest stock of around 1.8 MnT followed by Paradip in terms of volume and stockpiled 1.5 MnT. While, Gangavaram & New Mangalore port, stock of around 0.8 MnT & 0.7 MnT respectively. Stock at Krishnapatnam port has declined by 15.4% than previous week.

Week 13

The week ended on 29 Mar 2014, JSW Steel, Adani & SAIL have the highest quantity of Coal stock i.e. about 1 MnT, 0.8 MnT & 0.7 MnT respectively. BMG Commodities has stock around 0.36 MnT at Krishnapatnam port.

The ports considered are: Dahej, Mormugao, New Mangalore, Hazira, Kandla, Bhavnagar, Tuticorin, Magdalla, Pipavav , Muldwarka, Gangavaram, Haldia, Krishnapatnam, Kakinada, Paradip & Vizag.

 

Imported Scrap offers to India rise on Strong Currency

Imported Scrap offers to India rose by USD 15/MT over strong currency and high offers in global market.

Imported Scrap prices  have risen in Indian market owing to strong Indian currency, which has appreciated around 3% in last few trading sessions and rising offers in the global market.

Sources tell SteelMint that current offers from Middle East are hovering in the range of USD 380-385/MT CFR Mumbai based on quality & delivery, which has gone up by almost USD 15/MT from last month. Recently, a vessel carrying 8 containers of HMS 1 from Oman is to be delivered to Nhava Sheva Mumbai next week. The deal is heard to be settled at USD 383/MT CFR.

Indian importers are inclined towards Middle East offers. As per few market participants we talked, prompt delivery from Middle East is one of the major reasons for frequent transactions. It takes maximum of 7-9 days to deliver the material from Middle East to India. Currency fluctuation is also an important factor while trading internationally. An importer based in Mumbai opined,

Proximity of Dubai to India makes transit time shorter and the risk of currency fluctuation is minimized.
 

 US offer unviable for Indian Importers

Offers from US have appreciated steadily in past few days owing to speculation of price rise in US domestic market. The current offer of US shredded Scrap is at USD 400-405/MT CFR Mumbai, which is not feasible for Indian market, said an importer based in Mumbai.

 International Offers up on Strong Buying from Turkey

International offers has also boosted up to USD 372-376/MT CFR since major buyers in Turkey have again started procuring Scrap at higher rates due to growing buyers appetite. These offers are mainly from US & Europe. Similarly offers to South Korea, the world’s second largest Scrap importer have increased by few dollars.

 Election Sentiments strengthen Indian Currency

The positive sentiments for upcoming general election to be held in April have triggered inflow of FII money, which has led to steep appreciation of Indian currency. Parities seen in exchange rates are making offers quite attractive for Indian Scrap importers and feasible to import the material.

 Market participant speculates that the domestic Scrap prices in the month of April & May are expected to come under pressure owing to rise in Scrap imports and improved supply of Iron ore in the domestic market. Iron ore mines are expected to resume operations next month which may result to some correction in Sponge (DRI) & Pig iron prices.

Current Offers for Imported Scrap

Origin

Grade

CFR Port

Offers in USD/MT CFR

Dubai

HMS-1

Nhava Seva Mumbai

380-383

Dubai

HMS-1

Chennai

385

Europe

Shredded

Nhava Seva Mumbai

392-395

US

Shredded

Nhava Seva Mumbai

400-405

 

India: Structure Offers remain Firm; expected to improve in Apr’14

Structure offers remain unchanged in most of the cities on firm demand. However, market players expect prices may increase in April as demand from fabrication industries and some private projects are likely to improve.

Market players believe that slow construction activities and closing of financial year resulted in stable market this week. Structure prices in Western India (Mumbai & Ahmedabad) are firm from starting of the week and expected to be around in the same range till the March-end.

On the other side in Central India, manufacturers were quoting higher prices but deals are happening at INR 32,800-32,900/MT (50 mm Angle basic price).

A Raipur based trader told, “We don’t expect prices to change much in starting of the April, but yes slight improvement is expected as the month progress because of price change in Ingot and increased prices of material in Southern market. However, buying in Central India will more or less remain same.”

Durgapur’s Structure offers also increased but buyers refuse to purchase on higher prices and offers back on the same level. Durgapur, one of the leading Structure suppliers in Eastern region, supplies its 60% of total production to nearby states.

Limited trade movement kept Structure prices unchanged in Northern & Southern India and expected to remain unchanged. However, Ingot & Re-bar prices fluctuating slightly during the week.

Most of the market participants anticipated that market may increase in starting of the coming fiscal year i.e. FY15.

 

India: NCDEX to re-launch Steel Long Contract from Apr’14

NCDEX (National Commodity Exchange Ltd) is set to re-launch its steel long futures contract w.e.f April, 2014. According to company officials, this contract is similar to the previous one, with two delivery centers namely Raipur & Wada (Mumbai). Contract has been named as STEELCOMM (Ex-Wada). Exchange has got clearance from Forward Markets Commissions (FMC) on 24 Mar, 2014.

Exchange had previously suspended its steel long (Ex-Ghaziabad) contract in 2012, when Steel Ministry made BIS quality mandate for secondary steel manufacturers (later government extended it’s order). Exchange then introduced steel long contract with BIS (Bureau of Indian Standards) specification Ex-Mandi Gobindgarh basis.

With most of Ingot/Billet manufacturers still making commercial grade, exchange is set to launch commercial grade contract.

Modification in Contract for Steel Long Commercial

  1. Benchmark price will be considered at Ex-Wada (Mumbai)
  2. Will have only 2 delivery centers i.e. Raipur & Wada
  3. Exchange charges will be less than the previous contracts

BIS mandatory from 1 Apr, 2014 – All India Induction Furnace Association

According to All Indian Induction Furnace Association (AIIFA), BIS will be mandatory for a provision of penalty and prosecution for the defaulters.

For this, AIIFA met the officials of Ministries and tried to convenience to consider the genuine issues of Induction Furnace industries and requested to first provide some necessary basic infrastructure and R&D to Induction Furnaces units before implementing the order.

In order to review the status of implementation of the Steel Quality Control order, a meeting was held on 6Mar 2014, under the Chairmanship of Shri U P Singh, Joint Secretary of Ministry of Steel. During the meeting, AIIFA again requested for further date extension of the implementation in view of the major issues.

  • BIS authorities have not granted licenses particularly in Rajasthan (Jaipur/Bhiwadi)
  • Centralized laboratories have not been setup, required for small re-rolling mill & IF units 
  • High Phosphorus remains a problem in the Induction Furnace units

Mr Kamal Aggarwal, Sr VP, AIIFA, told SteelMint that BIS will be mandatory for all semi finished products coming under IS:2830 category, however IS:2831 has been exempted from BIS mandate. He also mentioned that association has put its concern to Steel Ministry and will try to get the extension.

He explains that according to BIS standards Sulphur & Phosporus content has to be below 0.1, which is not possible for Induction units using Sponge as their melting source. 

 

India: BHEL seeks Partners for Business tie-up

Bharat Heavy Electrical Limited (BHEL) invites global Expression of Interest (EOI) for diversification and looks for business partners to set up Iron ore beneficiation, Pellet plant & Coal Washery.

EOI is invited from reputed companies to collaborate and set up new Coal Washery Projects (both Coking & Non-Coking) on EPC/ Turnkey/BOM basis in India.

Also, in order to expand its operation in steel industry, BHEL tends to diversify an Iron ore beneficiation and Pellet plant with mutual agreement.

Criteria

  • Participants must have past experience in setting up a capacity of 2.5 MnT pa Coal Washery/ Ore Beneficiation plant
  • Participant must  submit its last three years turn over record
  • Documentary evidence (copy of contract, commissioning & performance report from client)  must be submitted along with the proposal

Important Date

Due date of submission: 28 Apr, 2014

About BHEL

BHEL, Government of India enterprise caters to expand its one of the unit namely Industrial System Group (ISG) located at Bangalore which works for Metallurgical & Non‐metallurgical industries, mining & bulk material handling.

 

India: OMML increases its Manganese Ore Prices by INR 250-500/MT

Orissa Manganese & Minerals Limited (OMML) increased their offer before MOIL has disclosed prices for the next quarter.

Private Manganese ore miner, Orissa Manganese & Minerals Limited (OMML), a subsidiary of Adhunik Metaliks has increased Manganese ore prices for 26-34 grade by INR 500/MT and 34+ grades by INR 250/MT w.e.f 1 Apr, 2014. OMML has an annual production of about 0.2 MnT and contributes 9% of the country’s overall Manganese ore production.

When questioned, regarding increase in offers when the general expectation of the market is that MOIL will cut its prices for the next quarter – a company official from OMML stated that there is high demand from Manganese Alloy smelters as the monsoon season is approaching and there is growing need to stock up right now. Also, there is resilient demand for Indian Silico Manganese & Ferro Manganese in the domestic as well as the overseas markets. SteelMint assessed that Ferro Manganese & Silico Manganese prices typically set the direction for Manganese ore prices.

 
Coal Import

India’s Non-coking Coal imports surge by 5.7% W-o-W

Non-coking Coal Non-coking Coal import reached around 3 MnT at the week ended on 22 Mar, 2014 and registered a jump of 5.7% against previous week.

SteelMint assessed that India has imported around 3 MnT at the end of week 12, which has increased from 2.8 MnT of preceding week. Out of the total imported, around 73% Non-coking comes from different destination.

Indonesia, a major supplier of Non-coking supplied around 2.4 MnT in the period of week 12 and registered a decline of 8.3% against the prior week.

A large quantity of Non-coking is imported from Indonesia, South Africa, Chile & Brazil. Out of the total weekly imports, India has imported around 0.23 MnT from South Africa which belongs to India Cement, Bhatia & Hindalco Industries. About 0.14 MnT & 0.08 MnT Non-coking arrived from Chile & Brazil which has imported by Coastal Energy & Adani Enterprises respectively.

Non-coking

Mundra has imported maximum quantity i.e. around 0.82 MnT of Coal, contribution of quantity was given by Adani Power, Coastal Gujarat Power & Adani Enterprises as per the consideration of 33 major & minor Indian ports. Krishnapatnam is the second highest quantity port that imported around 0.37 MnT of Non-coking.

Adani Enterprises & Adani Power are the major importers of Non-coking at the week ended on 22 Mar, 2014. Adani Enterprises has imported about 0.53 MnT from Indonesia & Brazil. Adani Power has imported around 0.42 MnT of Indonesian Non-coking Coal at Mundra & Dahej Port.