Monthly Archives: February 2018

NMDC Cuts Iron Ore Prices for March Deliveries – Sources

National Mineral Development Corporation (NMDC), state owned and India’s largest merchant iron ore miner has cut its prices by INR 90 to INR 120/t for March deliveries, according to sources. Company produces around 35-36 MnT iron ore annually.

The state-run firm has slashed prices after large mines in Odisha were allowed to resume operations on direction of Supreme Court.

Current prices for fines stand at INR 2,660/t (-100/t), lumps of size 6-40mm stand at INR 3,000/t (-100), DR CLO at INR 3,480 (-120) and ROM at INR 2,760/t (-90).

The Supreme Court order allowing some large iron ore mines like Serajuddin and Essel mining in Odisha to restart is likely to increase iron ore supply in domestic market.

Serajuddin has a production capacity of 15.15 MnT where as Essel Mining (Koira Mines) has a production capacity of 4 MnT per annum.

These mines had been ordered closed for defaulting in payment of compensation for overproduction. As a result, ore prices had risen sharply in recent months. Seven mines had shut down, some large, since the beginning of this year.

 

India: Imported Scrap Prices Up; Buying Slows Down

Indian imported scrap market observed thin trades in containers at high prices again this week, however, buying has slowed down over less trade activities on account of upcoming holidays for local Holi festival.

As per recent conversations with market participants SteelMint learned that, Indian imported scrap prices rise further in recent thin trades reported for containerized scrap this week. After booking around 4-5 bulk scrap vessels for March shipments in last one months’ time, Indian steelmakers have slightly slowed down the scrap imports.

According to sources, Shredded scrap in containers traded at USD 395/MT, CFR India west coast from UK based supplier recently. However, offers are very limited as most of the supplying yards are waiting and holding the offers over the expectations of further increase in prices after the second week of March.

The price assessment for Shredded scrap in containers from UK/USA increased to USD 395/MT, CFR Nhava Sheva this week. Offers for HMS 1&2 (80:20) in containers assessed at around USD 375-380/MT, CFR from Dubai, while it is heard at USD 365/MT, CFR from UK.

HMS 1 assessed from Dubai at USD 385/MT, CFR and from South Africa at around USD 375-380/MT, CFR Nhava Sheva. These offers have increased this week by USD 5-10/MT on W-o-W basis to India.

Suppliers are not offering actively to Indian markets at this moment as they are getting better prices in markets like Bangladesh and Pakistan. Most of the Europe based yards are waiting for a settling of domestic prices and likely to increase the offers again in coming weeks. Scrap booking slightly slowed down because of upcoming Holi festival holidays and which is likely to recover only from the next week. However, overall markets should remain strong for the months of March and April” – shared a source

Domestic scrap prices increased further by INR 300-400/MT on W-o-W basis amid tightened supply in India. Currently, HMS (80:20) prices in Mumbai and Chennai are assessed in the range of INR 25,300-25,800/MT (USD 388-395) (Basic prices, GST @ 18% extra).

 

Vietnam: HRC Importers Turn Active, Deals Reported

Vietnamese buyers have become active post Tet holidays and started receiving fresh offers of imported HRC amid bullish sentiments experienced in global market. Following this, buyers have concluded few deals from Chinese mills.

Meanwhile Chinese mills have also recently returned in the market post Lunar New Year Holidays offering fresh HRC export offers to Vietnam .

Few trade sources highlighted that currently few deals have been concluded by Vietnam based importers from Chinese steel mills-

1.Ton Dong A – a specialized company in producing cold rolled steel , galvanized iron etc in Vietnam has booked the material of 5,000 MT HRC at around USD 635/MT, CFR basis.

2.Nam Kim Steel – largest producer of galvanized steel coil, galvalume steel coil and pre painted in Vietnam has booked 10,000 MT HRC from a Chinese mill at similar price of USD 635/MT,CFR basis.

3.Hoa Sen (re-roller and flat coated steel producer)-Another deal was concluded by Vietnam’s Hoa Sen with China’s Benxi Steel of 20,000 MT at USD 635/MT CFR basis.

 

Daily Update: Indian Sponge & Billet Market

Indian billet and sponge market observed slight price rise of INR 100-200/MT on daily analysis. However, in Maharashtra (Mumbai & Jalna) the producers have sharply raised billet prices by INR 300-500/MT following improved demand.

SteelMint’s price assessments for induction furnaces billet size 125×125 mm are reported at INR 32,100-36,000/MT (USD 494-554) ex-plant. Further, the coal based sponge (78-80 FeM) C-DRI price assessment was at INR 20,200-22,100/MT (USD 311-340); prices are ex-plant & excluding GST.

On 28th Feb 2018 (Wednesday) INR to USD exchange rate stood at INR 65.16 & BSE Sensex closed at 34,184 (-162).

Key Market Updates:

1. Vizag Steel concludes 10,000 MT billet (IS 2830, size 90*90 mm) export tender at around USD 520/MT and 10,000 MT bloom (IS 2830, size 150*150 mm) at around USD 510-515/MT. Both deals on FoB India basis.

2. Coal India Ltd (CIL) has reported a growth of 3% Y-o-Y in coal supplies to the power plants in Jan’18 & stood at 40.6 MnT against 39.6 MnT in Jan’17.

3. Tamil Nadu News Print Ltd invites global tender for import of 300,000 MT Non-Coking coal

4. Durgapur, Eastern India based private pig iron producers have offered steel grade at INR 29,500-29,700/MT

5. Raipur, Central India based Integrated plants offer increased by INR 100-200/MT D-o-D, offering Sponge P-DRI at INR 19,900-20,000/MT & Sponge DR CLO grade at INR 22,000-22,200/MT ex-plant

6. Bhaskar Steel and Ferro Alloy Ltd, an Odisha based plant offered FeM 80 C-DRI at INR 20,300-20,400/MT & billet at INR 32,000/MT ex-plant an official reported. And added export deal of one rake billet to Nepal a day ago at around USD 498/MT (ex-mill).

7. BMM Ispat in South India (Karnataka) has increased offers for FeM 80 P-DRI by INR 100-200/MT to INR 20,000/MT ex-Bellary, an official reported.

8. Bellary, Karnataka based furnace owners selling billet to Chennai (Tamil Nadu) at around INR 34,500/MT on FoR basis.

9. Today, Rebar & Structure prices in Mumbai & Raipur increase by INR 100-200/MT on raise inquiries & increase billet prices

10. Imported scrap offers to India increase by USD 10-12/MT in a week, offers for HMS 1&2 (80:20) Dubai origin containers stood at USD 380/MT, CFR Nhava Sheva

Reference prices as on 28th February 2018

  Particular/Delivery Size, Grade, Origin Prices Min Max Change 1W 1M
C-DRI Ex-Durgapur Mix, FeM 78%, +/-1 22,100 22,000 22,200 + 100 22,100 21,700
Ex-Rourkela Mix, FeM 80%, +/-1 20,450 20,400 20,500 – 50 20,700 20,900
Ex-Raipur Mix, FeM 80%, +/-1 21,300 21,200 21,400 + 100 21,400 21,300
Ex-Bellary Lumps, FeM 80%, +/-1 20,600 20,500 20,700   0 20,900 20,300
P-DRI Ex-Durgapur Lumps, FeM 78%, +/-1 21,000 20,900 21,100 + 50 21,000 20,600
Ex-Raipur Lumps, FeM 80%, +/-1 19,900 19,800 20,000 + 150 20,200 20,000
Ex-Bellary Lumps, FeM 80%, +/-1 19,900 19,800 20,000   0 20,100 19,600
Ex-Hyderabad Lumps, FeM 80%, +/-1 20,500 20,400 20,600   0 20,900 19,900
Ingot Ex-Mandi Gobindgarh 3.5 x 4.5 Inch, IS 2830 35,200 35,100 35,300 – 50 35,800 34,700
Ex-Durgapur 3.5 x 4.5 Inch, IS 2830 32,800 32,700 32,900 + 200 32,800 31,600
Ex-Rourkela 3.5 x 4.5 Inch, IS 2830 31,450 31,400 31,500 – 50 31,700 30,900
Ex-Raipur 3.5 x 4.5 Inch, IS 2830 32,100 32,000 32,200 + 100 32,500 31,700
Ex-Mumbai 3.5 x 4.5 Inch, IS 2830 34,600 34,500 34,700 + 600 34,800 34,000
Ex-Chennai 3.5 x 4.5 Inch, IS 2830 34,000 33,800 34,200   0 34,000 33,500
Ex-Hyderabad 3.5 x 4.5 Inch, IS 2830 32,800 32,800 33,000 – 200 33,000 33,750
Billet Ex-Mandi Gobindgarh 125×125 mm, IS 2831 36,000 35,800 36,100   0 36,600 35,400
Ex-Durgapur 125×125 mm, IS 2831 33,200 33,100 33,300 + 200 33,200 32,100
Ex-Rourkela 125×125 mm, IS 2831 32,200 32,100 32,300   0 32,400 31,400
Ex-Raipur 125×125 mm, IS 2831 32,800 32,800 32,900 + 100 33,300 32,400
Ex-Mumbai 125×125 mm, IS 2831 34,800 34,700 34,900 + 600 35,000 34,200
Ex-Chennai 125×125 mm, IS 2831 34,500 34,400 34,700   0 34,500 34,000
Ex-Hyderabad 125×125 mm, IS 2831 33,000 32,800 33,000   0 33,000 33,750
TMT Ex-Delhi/NCR 12MM 38,200 38,000 38,400 – 400 38,500 38,200
Ex-Durgapur 12MM 37,500 37,300 37,700 + 200 37,300 36,300
Ex-Raipur 12MM 36,200 36,000 36,400 + 100 36,700 36,000
Ex-Mumbai 12MM 38,700 38,300 38,800 + 200 39,200 38,800
Ex-Chennai 12MM 38,800 38,700 39,000   0 38,600 38,750
Ex-Hyderabad 12MM 38,500 38,300 38,700   0 38,700 37,700

Basic prices in INR/MT & excluding of GST @ 18%
Source: SteelMint Research

 

Indian Rebar Offers Volatile Amid Improved Inquires

Domestic rebar prices remained volatile by INR 100-400/MT on SteelMint’s daily price assessment. According to the market participants, Inquiries have improved today specifically in Central, East & West India.

According to SteelMint price assessment, today the offers by medium mills for 415/500 Fe grade rebars (size 12 mm) are reported – at INR 36,200-36,400/MT (+ 100) ex-Raipur, INR 37,500-37,700/MT (+200) ex-Durgapur, INR 38,700-38,800/MT(+200) ex-Mumbai, INR 38,500-38,700/MT(0) ex-Hyderabad & INR 38,200-38,400/MT (-400) in Delhi. The changes mentioned above are day-on-day basis.

As per Industry participants, prices may rebound anytime soon as trends are strong globally. Moreover the high cost of raw-material also indicates towards a recovery in prices.

SteelMint also assessed that, the producers and suppliers are anticipating that post festival of Holi local demand would improve thus leading to prices surge. They also added that large producers likely to further raise long steel prices for Mar 2018 deliveries which may bring positive trends in the markets.

Trade Log

1 Jalna based Kalika Steels reduced their prices by around INR 200/MT d-o-d basis and currently offer basic rebars at INR 36,000/MT and as per further anticipation, market should be on the same level due to existence of current demand which might prevent any major changes.

2. Mahalaxmi TMT based in Wardha – Maharashtra also reduced rebar prices around by INR 300/MT and the latest offers for the day for 12 mm are reported at INR 36,800/MT ex-plant and excluding GST. As per officials, supply movement is fairly average and sentiments appear to be optimistic.

3. North Region based Rathi Steels has reduced prices by around INR 400/MT d-o-d basis and offered 12 mm at INR 39,200/MT ex-Delhi. As rebar has limited supply extent and inappropriate quoting has been refrained and supply movement is getting placed as per the requirement.

4. Shakti Ferro Alloys in Chennai, South Region has offered Rebar at INR 38,500/MT (12 mm), Billet at INR 34,500/MT and further as per trade participants view, market is lacking for suffice liquidity flow and it might lead to slight fluctuations.

5. Tulsyan NEC Steel (Tulsyan) based in Chennai has kept the same prices and offered Rebar 12mm at INR 40,500/MT & Billet at INR 35,500/MT, ex-plant & excluding GST.

6. Gujarat based Akshar TMT have unchanged their rebar prices D-o-D. The fresh offers are reported at INR 46,800/MT FOR & including GST at 18%, Size – 20 mm and as per officials market demand is very limited due to festive mood but won’t get any major downfall as financial year ending will provide an impetus to finish long due infrastructure projects.

7. Central India based Raipur Power and Steel Ltd offering Wire Rod (5.5 MM) at INR 38,000/MT, Ex-Mill & Excluding GST and as per trade participants view supply movement will get appropriate direction with utilization of procured finish long products for completion of pending projects.

 

India: Domestic Flat Steel Market Awaits Next Price Revision

Indian flat steel prices have remained stable since last couple of weeks owing to slow demand and limited trade activities in domestic market.

Although market participant mentioned that Indian mills are planning for another hike in flat steel prices by INR 1,000-1,500/MT in domestic market for March.

Supply shortage, higher landed cost of HRC imports amid lesser import bookings have propelled the Indian manufacturers to further raise the prices of flat steel in domestic market.

However few trades sources mentioned that stockiest and traders are still skeptical about whether the increased prices will be absorbed or not.

However,currently trade reference prices (basic) for HRC (IS2062) 2.5 mm-8 mm are assessed at INR 44,500/MT (ex-Mumbai), INR 44,500/MT (ex-Delhi),INR 44,500-45,000MT (ex-Chennai).The prices mentioned above are basic prices excluding GST @ 18%.

Trade reference prices (basic) for CRC (IS513) 0.9mm is hovering in the range of INR 48,000-48,500/MT (ex-Mumbai) INR 48,500-49,000/MT (ex-Delhi) and INR 48,000-48,500/MT (ex-Chennai).The prices mentioned above are basic prices excluding GST@18%.

 

Indian Ferro Chrome Offers Move Up on Anticipated Demand

Indian Ferro Chrome producers raised their offers as bullish sentiment paves its way through.

Demand for the commodity in the Indian market remains firm and deals are being concluded actively.

“Major stainless steel mills are purchasing Ferro Chrome in the range of INR 82,000-83,000/MT while deals for smaller size quantities are taking place at around INR 83,000-84,000/MT,” said a producer source. SteelMint assessed Ferro Chrome prices at INR 83,000/MT (Ex-Odisha).

“The domestic Ferro Chrome price is expected to remain firm, however a slight uptick in the coming days can’t be ruled out,” said a producer source while hinting towards a further rise in prices.

Post-lunar year holidays, only one or two deals are heard to have been concluded with Chinese buyers, while a source claimed that the Chinese market is witnessing limited activity, and the coming week will give a clearer picture.

Indian producers are quoting 100 cents/lb CIF China while one deal was heard to have been concluded at 99.5 cents/lb CIF China but most of the producers haven’t yet been able to realize at the aforementioned level in China.

Inquiries from Japan and Korea still remains very limited as they are keenly waiting to see what tender price the Stainless Steel mills from China release for March. However, its export price maintaining stability at 102 cents/lb and 101 cents/lb for South Korea.

Japan and South Korea are observed to be in a wait-and-watch mode as they postpone their purchase to get a clear market direction which depends on China’s stance after its holidays.

“There has been an anticipation that Chinese major stainless-steel firms will increase their purchase price to the current spot levels,” said a source suggesting that the current spot price is higher than the tender price of 7,900 Yuan and hence they will level it up or even exceed the current prices depending on the requirement.

On the future outlook, Ferro Chrome offers are expected to witness a northward movement on the backdrop of strong demand coupled with rising Chrome Ore prices.

 

Indian Pig Iron Offers Rally on Limited Supply

Indian pig iron producers have further raised their offers by around INR 200-500/MT (USD 3-8) in last 2-3 days. Short supply by private producers amid production halts by a couple of big merchant suppliers, has led to surge in domestic pig iron prices.

SteelMint learnt that, most private producers in Central & East India have cut sales due to either none availability or diversion of hot metal towards production of Finished steel products rather than pig iron.

Neelachal Ispat (NINL), which is India’s largest steel grade Pig iron manufacturer, continues to remain out of operation since the last 2 to 3 months due to ongoing capital repair works and is expected to restart production after March.

Another large producer of Foundry grade pig iron- Vedanta Resources (known as Sesa Goa Ltd) has reduced supply in open market due to expected Iron ore crisis in near future following Supreme Court ordered cancellation of mining leases in Goa. Vedanta’s Iron Ore mines which have a total production capacity of 5.5 million tonnes per annum and has been a primary source of raw material for the company would also cease operations.

Officials from Jindal Steel (JSPL) also stated that no stock for Granulated Pig iron, Pooled iron & Pig iron were available due to advance bookings amid priority for home consumption. The last trades have been made for Granulated Pig iron (panther shots) at INR 27,500/MT and Pooled iron at INR 26,500/MT, ex-Angul, Odisha.

SteelMInt’s price assessment for Steel grade in current week stood – at INR 29,500-29,700/MT ex-Durgapur, INR 29,800-30,200/MT ex-Raipur, INR 29,000-29,500/MT ex-Odisha & INR 27,500-28,000/MT ex-Vizag/Hyderabad.

In context to exports the offers remain firm around USD 360-370/MT FoB India & USD 350-360/MT FoB Black Sea. SteelMint’s previous assessment was at around USD 380-385/MT FoB India.

Key Updates

1. Raipur – Central India based suppliers are offering steel grade pig iron in the range of INR 30,000-30,500/MT FoR. The last trades by the market participants are reported at INR 29,800-30,000/MT.

2. Neo Metaliks in Durgapur – West Bengal has kept offers unaltered and are assessed at INR 29,500-29,700/MT ex-plant.

3. Bokaro based Electro Steel which produces 25,000 tonnes of steel grade material had concluded a deal of 1,000-1,200 MT steel grade Pig iron at around INR 29,750/MT ex-plant.

4. Girdih based Pig iron producers have kept offers at firm level amid improved demand. The steel grade offers are reported at INR 29,800-30,000/MT ex-plant & excluding GST.

5. Coking coal offers continue to rise globally over good demand from mill owners. The latest offer for the Premium HCC is assessed at around USD 245/MT CNF India, rise around USD5/MT, W-o-W.

 

Stronger Demand Keeps Coking Coal Prices at Highs

MARKET TREND

Coking Coal prices in Australia—the key international market—have maintained the uptrend on the back of stronger demand and some supply disruptions.

Steel mills in China are now back to business after the Chinese Lunar Year holidays getting over. Interestingly, the steel production cap, mandated by the Chinese Government during the winter season, on environmental concerns, will come to an end on 15Mar’18.

The deck is now clear for full-fledged steel production to resume in China. And this has triggered aggressive purchases of Coking Coal among the steel makers there—resulting in the coal sellers in Australia seeing stronger demand, in response to which the sellers lifted the spot prices constantly.

At the same time, heavy rains in Australia also have been a factor behind the sellers tending to lift their coal prices.

Alongwith the Chinese steel makers, Indian steel producers also are in an importing spree as active steel production is going on. In India, consumption of the coal, and hence the imports, will go further up in the future as steel production capacity in the country will increase. As a matter of fact, India is poised to overtake Japan as the second largest steel producer in the world within 2018.

PRICE TREND

Offers for the Premium HCC are now hovering at around USD 232.50/MT FoB Australia, which are around the rates in the week last. However, offers for the 64 Mid Vol HCC underwent a slight dip from the week-ago rates. Offers for the 64 Mid Vol HCC are hovering at around USD 194.90/MT FoB Australia.

Source: CoalMint Research

On CFR India basis, these offers translate into: USD 246/MT and USD 208.40/MT respectively.

A Canadian Coking Coal offer was heard at around USD 207/FoB.

IMPORTS

Domestic supply inadequacy of the coal and prevalence of active steel making are the twin factors for the influx of significantly high volumes of Coking Coal imports in India. During the 1-26Feb’18 period, around 3.6 MnT of Coking Coal was imported in India, data compiled by CoalMint Research shows.

 

 
CIL Coal Dispatch to Power Plants

CIL: Coal Dispatch to Power Plants Increase 3% Y-o-Y in Jan’18

According to the data provided by Coal Ministry, Coal India Ltd (CIL) has reported a growth of 3% Y-o-Y in coal supplies to the power plants during Jan’18. The company had dispatched 40.6 MnT coal to the power stations in Jan’18, against 39.6 MnT in Jan’17.

In order to pull out power plants out of the critical situation, CIL was increasing the coal supplies to the power plants and had posted regular growth on the monthly basis. However, CIL’s dispatch to the power plants had witnessed a fall of 4% M-o-M in Jan’18, from the dispatch of 42.1 MnT coal reported in Dec’17.

Still, on the back of enhanced coal supplies to the power plants, CIL has revived the available coal stock at the power stations. Coal stocks at the power stations recorded at 15.587 MnT as on 26 Feb’18, was gauged at significantly higher levels as compared to 8.5 MnT on 30 Sep’17.

CIL had managed total dispatch of 372.6 MnT coal to the power plants during Apr’17-Jan’18, which was 7% higher on the year compared with the dispatch of 347.5 MnT coal during Apr’16-Jan’17 period.

The Coal Ministry report has also highlighted that the outstanding dues payable by power sector to CIL was INR 9815.50 Crore, till Jan’18. Out of the total amount, the sum of INR 8305.69 was accounted for undisputed dues.

SCCL Coal Dispatch to Power Plants:
Singareni Collieries Company Ltd (SCCL) following in the footsteps of CIL has also recorded growth in coal supply to the power plants.

SCCL’s coal dispatch to the power stations had increased 5.6% Y-o-Y to 43.74 MnT during Apr’17-Jan’18 period. The company had supplied 41.43 MnT coal to the power plants in Apr’16-Jan’17.