Monthly Archives: June 2017

South African Coal Prices

South African Coal Prices Maintains Stability

South African Coal prices have not seen any significant movement this week, with index price API 4 hovering in the range of USD 76-77.

South African coal index was assessed at USD 77.70 yesterday for Jun’17.

Congestion at Richard Bay Coal Terminal continued and had reduced cargo availability. Moreover, Tightness on coal availability still persists this week.

However, Market participants are anticipating these issues will be resolved soon, and would not affect coal prices further.

South African 5500 NAR was available at a discount of USD 7.5-8/MT to 6000 NAR prices, while 4800 NAR coal was available at a discount of USD 13/MT against buyers expectation of USD 15-16/MT.

At present, spot coal prices were assessed at USD 66-67/MT, FoB Richards Bay for 5500 NAR. While 4800 NAR was offered at USD 52-53/MT, Fob Richards Bay.

Indian Market Scenario:
India Buying has been affected by the news of GST implementation, as buyers wait to see the impact on forthcoming tax on coal sales.

The GST Council has kept coal at the lowest tax slab of 5%, which is down by 6.69 from the hitherto tax incidence of 11.69%.

According to the primary research done by CoalMint, GST will bring down domestic coal price in India, various taxes like Service Tax, VAT will be subsumed under GST and the total additional tax on coal will be 5%.

However, cost of imported coal is expected to increase due to GST, as buyers would have to pay 5% tax on account of tax in addition to 2.5% custom duty. At present, there is 2.5% customs duty and 2% countervailing duty (CVD) on imported coal.

CVD tax and VAT will be relaxed under GST; however additional tax of 5% will cause a hike in imported coal prices.

Moreover, GST may increase port charges following increase in tax on that to 18% from the existing rate of about 15%.

Further clarification on tax structure will be made available after the implementation of GST later this week.

5500 NAR coal was available in the stock and sale market at INR 5750/MT in Vizag port, and at INR 5800/MT in Krishnapatnam port. While 4800 NAR coal was available at INR 5200/MT in Vizag port and at INR 5200/MT in Krishnapatnam port (VAT/CST and TCS charges to be added in above prices).

 

Techno Commercial Bid Results for SAIL’s Ferro Manganese Tender

9 plants participated in the techno-commercial bid for the latest SAIL tender, in which it intends to procure a tentative quantity of 10,500 MT Ferro Manganese in 3 months – July to September.

The techno-commercial bid revealed that 9 plants had participated in the tender. The final results of the tender should be known in the coming week.

List of Participating Companies with Offer Quantities are:

Sl. No. Company Market 1 (Quantity. In MT)
1 Maithan Alloys Limited (WB) 6500
2 Sarda Energy (Raipur) 4500
3 Hira electro Smelters (Bobbali) 3000
4 Surya Alloy Industries (WB) 10500
5 Sarda Metals (Vizag) 4500
6 The Metallic Alloy (Raipur) 2500
7 Shyam SEL (Kolkata) 10500
8 Shree Ambey Ispat (WB) 2500
9 Shree Girja Smelters (Raipur) 4500
 

Indian Pig Iron Export Tender Concluded at a Higher Price: Sources

MMTC, India’s largest and state owned trading house, had floated an export tender of 30,000 MT Pig Iron on behalf of NINL (Neelachal Ispat Nigam Limited) which got expired on 27 Jun’17.

As per market sources report to SteelMint, the company received good response and it managed to receive bids from three parties. According to market participants, the company received H1 bid around USD 299-300/MT followed by 2nd highest bid at around USD 295/MT followed by next bid at USD 292/MT.

In the latest update received, trade sources highlighted that the company has concluded the tender at around USD 300-302/MT, FOBST Paradip port.

The shipment period for the material is scheduled between 10 Jul-20 Jul’17.

Few trade sources are of the view that the company may come up with the next export tender.

MMTC’s previous pig iron export tender which expired on 15 Jun’17 received poor response following which the company canceled it. As per market sources, the bids received were in the range of USD 290-295/MT, FoB basis.

NINL reduced domestic pig iron prices thrice in Jun’17 – Owing to declining demand amid GST, NINL reduced pig iron prices thrice in Jun’17. In its latest price cut announced on 24 Jun’17 the manufacturer reduced prices by INR 500/MT. The latest offers are reported for Steel (N1) grade at INR 20,000-20,250/MT (USD 307-310) & Foundry (N2) grade at INR 20,250-20,500/MT (USD 310-315); prices are basic, ex-Cuttack, East India. Bulk purchase discount remain unaltered at INR 100-400/MT.

 

SAIL Floats Tender for Import of 77,000 MT MS Scrap

SAIL, India’s largest and state owned steelmaker, has floated a global tender to procure a total quantity of 77,000 MT Melting Scrap at Salem Steel plant (SSP) and Alloy Steel Plant(ASP) for a period of 6 months on CFR Chennai Port basis/ICD Durgapur basis.

Salem Steel Plant (SSP), a unit of SAIL located in Tamil Nadu intends to procure a cumulative quantity of 77,000 MT MS Scrap in two lots (HMS1 & Shredded Scrap). The required quantity will be needed for a period of 6 months. The quantity breakup is HMS1 at the rate of 6,300 MT per two month (total 18,800 MT) and Shredded Scrap at the rate of 19,400 MT per month (total 58,200 MT).

The tenderer must have successfully supplied a minimum quantity of 5,640 MT of MS Scrap (HMS1/HMS2) in preceding five financial years. In case of Shredded scrap, they should posses a minimum supply experience of 17,460 MT of non-alloy steel melting scrap (Shredded) as per US ISRI code 211 in preceding five years.

Validity

The bid shall remain valid for eight months from the date of first tender opening.

Quotation of Prices

Overseas bidders should give their quotation in USD/MT on CFR Chennai Port basis/ICD Durgapur basis. Domestic bidders should give their quotation in INR/MT on FoR-SSP basis/FOR ASP basis.

Material Packing

Material should be packed in 20 feet end-opening containers

Mode of Dispatch

Imports will be through sea upto Chennai Sea Port and then by road from Chennai to Salem Steel Plant. Domestic supplies will be dispatched by road. For ASP imports will be through Kolkata Port, Durgapur.

Tender schedule

Last date of submission of bids will be 27 July’17 at 15:00 hrs and opening of bids will be conducted on 28 July’17 at 10:00 hrs.

For contact details view tender section:
http://www.steelmint.com/tender/import-of-ms-scrap-7997

 

 

Sluggishness Persists in Indian Anthracite Coal Market

Anthracite Coal market in India has remained in the sluggish state, with buyers having almost no affinity for importing the fuel.

There also has been no major fluctuation in the international offers in the recent past. The latest offer for Anthracite Coal is assessed at around USD 115/MT CFR India, which is almost at around that assessed the week last.
anthracitecoalprices

Source: CoalMint Research

Given the prevailing fuel preference among the users, there seems to be no prospect for the market to undergo any upturn in the future. Indian users prefer alternate fuels instead of Anthracite Coal.

IMPORTS

During the 1-29Jun’17 period, a meager volume of 230,947 MT of Anthracite Coal was imported in India, data collected by CoalMint Research shows.

 

Coal Ministry Plans Reverse Auction Model for Upcoming Commercial Coal Mining

The Coal Ministry is now considering implementation of a “reverse auction” model for the upcoming commercial coal mining in India.

The new model is being considered in the wake of private players criticizing the originally planned “revenue sharing model” for awarding coal blocks for commercial coal mining in the country. In the “reverse auction” model, the bidder who promises to charge the least from the ultimate consumer will be the block winner. The bidder will have to quote a minimum price (lower than a pre-fixed ceiling price), at which he will sell the coal. In accordance to the norms of the “reverse auction”, the lowest bidder will be allotted the block.

The rationale behind the planned shift in the auction model is that the “reverse auction” model is believed to be able to fulfill the government’s objective of providing cheap energy to the masses, especially to those who use the fuel for cooking.

The Coal Ministry plans to bid out 30 MnT of coal reserves in the first phase of commercial coal mining. In this type of coal mining, private players are allowed to mine and sale coal in the open market without any restriction on the end-use.

 

India: Ferro Manganese Market Quiet; Prices Drift Lower

India Ferro Manganese market is mostly quiet, as domestic buyers continued to steer away from procurement on event of GST implementation.

Buying interest in the domestic market for Ferro Manganese was very low as buyers’ judgment is clouded by uncertainty over GST implications.

Demand has weakened in the domestic market and buyers with immediate requirement are only procuring and in very limited quantity. The current offers for Ferro Manganese (Ex-Durgapur) and (Ex-Raipur) has slipped to around INR 74,500/MT.

Demand from overseas market is moderate but offers for the same have also come down in line with domestic prices. SteelMint assessed that the Indian producers are lowering their offers due to selling pressure and are keen to generate higher sales from the export market.

Indian producers are offering Ferro Manganese 70% min at around USD 1140/MT FoB India (East Coast), and 75% min. is being offered at around USD 1210/MT FoB India.

“There is very little buying interest and prices continue to slide as suppliers cut offers aggressively to secure consumer demand,” stated a trader from India.

Market participants were observed to be bullish for the next 1-2 weeks as they expect the buyers to purchase aggressively post GST implementation, as most buyers had postponed procuring to July.

FeMn

 

China: Rebar Export offers Decline Marginally despite Surge in Spot Market

After continuous rally in Chinese rebar export offers, there was slight correction by USD 5/MT and the fresh offers are around USD 445-455/MT, FoB China.

Although, spot prices in China moved up in the pursuing week which was continuously declining on down trend due to rainy season which slowdown constructions activities in last couple of week.

The offers are surge around 90 Yuan (USD 13) with current offers witnessed – East China, Shanghai at 3,570 Yuan (USD 527) and 3,620 Yuan (USD 534)  in North China, Beijing as on 30th Jun’17.

CIS export offers registered sharp increase by USD 25/MT (W-o-W) to USD 435-440/MT, FoB Black Sea. The move was spurred by the rise in Chinese export prices in last few weeks, as per sources.

For the week, Turkey’s domestic offers remained on upside over improved demand in construction segment. But the export offers unaltered as there was no major deals at the offer prices of USD 430-440/MT.

UAE import offers remained unaltered even though the Ramada festival ended this week. The fresh offers are at around USD 440-443/MT for the week.

weekly global rebar export graph

Sources: SteelMint Research

 
India Iron Ore Movement ,India, Iron Ore, Movement

India: Iron Ore Movement Up 8% M-o-M in May’17

As per SteelMint’s analysis, iron ore movement across major producing states of the country was recorded at 11.49 MnT in May’17 which was at 10.66 MnT in Apr’17. The figures are compiled on the basis of movements made via railways, trucks, Karnataka and Goa e-auction data and import data as per customs. The figures indicated do not include the captive iron ore movement of SAIL & Tata Steel and movement for exports.
India Iron Ore Movement ,India, Iron Ore, Movement

State-wise iron ore movement analysis:

Iron ore dispatches from Odisha Up 10% M-o-M in May’17 – Compared with the previous month Odisha iron ore dispatches increased by 10% M-o-M from 5.82 MnT in Apr’17 to 6.41 MnT in May’17. Among Odisha’s merchant iron ore miners – Rungta Mines dispatched highest quantity of ore followed by Serajuddin Mines and KJS Ahluwalia. Iron ore dispatch by Odisha based merchant mines grew by 9% in May’17 and was recorded at 6.17 MnT against 5.66 MnT in Apr’17.

Chhattisgarh iron ore movement down 11% at 1.59 MnT – Iron ore movement from Chhattisgarh fell from 1.79 MnT in Apr’17 to 1.59 MnT in May’17. NMDC in total supplied 317 rakes of iron ore from its Bailadila mines in Chhattisgarh last month against 340 rakes in Apr’17. Thus NMDC’s iron ore supply from Bailadila mines has gone down by 11% M-o-M in May’17.

Karnataka iron ore e-auction sales at 2.32 MnT in May’17 – Iron ore sales via Karnataka e-auctions stood at 2.32 MnT in May’17 up 14% M-o-M. NMDC sold 1.09 MnT iron ore via e-auctions. JSW Steel remained the largest buyer at 1.74 MnT followed by BMM Ispat.

Indian iron ore imports increased in May’17 – India imported 0.39 MnT iron ore in May’17 compared to 0.28 MnT in previous month. JSW Steel was the largest importer in May’17 at 0.17 MnT followed by Essar Steel at 0.11 MnT. Pellet imports to India remained nil in May’17.

Exports: Iron ore down but pellets up from India in May’17 – Indian iron ore exports moved down and stood at 1.92 MnT in May’17, down 37% M-o-M. Vedanta was the largest exporter at 0.84 MnT followed by Fomento Resources and NMDC. Indian pellet exports which were recorded at 0.49 MnT in Apr’17 increased to 0.55 MnT in May’17. BRPL was the largest exporter with 0.16 MnT pellets followed by JSPL with the quantity of 0.15 MnT.
India Iron Ore Movement ,India, Iron Ore, Movement

 

Indian HRC Export Offers Surge Over Rising Chinese Steel Prices

Chinese HRC export offers have gone up this week by USD 10/MT W-o-W. Following the suit, a major Indian steelmaker has also raised the HRC export offers by USD 10-15/MT.Chinese HRC export offers is showing upward trend, propelling the Indian mills to surge the export offers in the global market.

Market participants highlighted that the steel maker has sold nearly 20,000 MT of HRC to Vietnam for Sep ‘17 shipments in the range of USD 470-475/MT, FoB India which is equivalent to USD 485-490/MT, CFR Vietnam.

As per sources major steel players in India have sold nearly 2.5-3 lakh tonnes of HRC in last few days for Jul and mid Aug shipments.They have now closed the bookings.

Previously deals have been concluded for Aug’17 shipments in the range of USD 470/MT CFR Vietnam.

Demand for Indian cargoes have started picking up from overseas buyers as Chinese HRC export offers are witnessing continuous hike and are anticipated to increase further over positive domestic market.

Indian  export volumes accounts for 35% of HRC share in May’17
According to provisional data released by Joint Plant Committee (govt. of India) country exported 1.03 MnT flat steel in May’17, out of which HRC export accounted for 0.36 MnT which shows that 35% of HRC/strips has been exported from India.

Screenshot from 2017-06-30 14:14:33