Monthly Archives: May 2019

Are Major Indian Mills Considering Price Hike in Long Steel for June ?

Indian large mills are set to announce prices for Jun’19 deliveries and the announcement is expected to be out next week.

SteelMint learned from officials of primary mills that there may be a price hike of around INR 500-1,000/MT (USD 7-14) in specific regions due to strengthening raw material prices in domestic as well as in global market.

The basic raw materials i.e. Iron ore fines/lumps prices through the major miners in eastern India surged by around INR 600/MT (USD 9) amid positive sentiments & improved export demand. This led to surge in production cost of mills up to certain level which would reflected in finish steel price range.

However few indications of trade sources from a major mill are also about keeping prices unchanged for June deliveries considering retail segment where demand is limited or not up to the mark as monthly price range has fallen by around INR 1,500/MT (USD 21) particularly in western region through the medium/small scale mills. Whereas, large mills rebar price range has slumped by around INR 500-1,000/MT (USD 7-14) on monthly basis in specified locations.

Notably limited demand also affected production level, which recorded fall of around 16% and registered at 3.79 MnT in Apr’19 against 4.49 MnT in Mar’19.

In addition the participants shared that average movement in projects supply may led to stability in finish steel prices for June deliveries. However it would be interesting to see the revision in next week.

 

India: Imported Scrap Offers Inch Down; Limited Deals Reported

SteelMint learned from industry participants that containerized scrap offers to South Asia have remained rangebound amid slow demand. Indian market observed few trades amid improvement in demand after the election’s outcome, however, Pakistan and Bangladesh trades remained subdued on upcoming Eid holidays mood.

Turkey scrap prices have shown correction in deals concluded from the Baltic origin towards the closing of the week keeping global sentiments under pressure.

Indian imported scrap prices range-bound in recent deals – SteelMint’s assessment for containerized Shredded from Europe, UK and US stand in the range USD 330-333/MT, CFR Nhava Sheva, slightly down by USD 2-3/MT against last week’s report. Decent quantities of Shredded has been booked in this price range however, few scrap suppliers were not ready to lower offers further resulting in limited trades. Few leading suppliers are offering Shredded at around USD 335/MT, CFR Nhava Sheva and USD 340/MT, CFR Vizag.

South African HMS 1&2 offers stand in the range of USD 330-335/MT, CFR. Few offers of Dubai origin HMS 1&2 scrap were heard in the range of USD 325-327/MT as per quality amid limited supply on ongoing Ramadan month.

Few trades for West African origin containerized HMS were reported in the range of USD 310-315/MT, CFR India with limited trades reported at USD 312-314/MT, CFR Goa and Chennai. Sponge Iron prices remained competitive while few steelmakers were working on production cuts to manage supply-demand in the market. Limited buying interest was reported with subdued demand in the market amid issues of labor shortage on extreme summer conditions in most of the regions in the country.

Tata Steel cancels 10,000 MT imported scrap tender – As per sources, around two weeks ago, Tata Steel had canceled 10,000 MT imported scrap tender amid disparity in bids and expectations, the company had received lowest bids at USD 326/MT for Shredded and HMS at around USD 320/MT, CFR Vizag.

Domestic scrap prices showed a mixed trend with an assessment of local HMS 1&2 (80:20) has marginally increased by INR 100/MT on weekly basis to INR 23,600-23,900/MT (USD 338-343, ex-Chennai while stands at INR 24,700-24,900/MT (USD 353-357), ex- Mumbai. USD/INR exchange rate stands at 69.7 levels today against 69.9 levels a week back.

Pakistan to turn silent on Eid holidays – On upcoming Eid holidays for almost a weeks’ period, scrap activities in Pakistan, Bangladesh, Turkey and Dubai likely to almost close down resulting in sentiments to remain dull.

Pakistan’s currency PKR has continued appreciation over this week as it recovered to levels of 146 against USD. However, no major impact on steel prices witnessed yet.

SteelMint’s assessment for containerized Shredded stands at USD 330/MT, CFR Qasim, Few recyclers were offering at USD 335/MT, CFR Qasim and traders remain offering mostly in the range USD 330-332/MT, CFR.

Bangladesh buying interest remains subdued – SteelMint’s assessment for containerized Shredded stands from UK at USD 345-350/MT, CFR and HMS from South America at around USD 330-335/MT, CFR Chittagong.

 

Japan: Tokyo Steel Cuts Scrap Purchase Prices at 3 Works

As per new price circular released, Japan’s leading EAF mini-mill – Tokyo Steel has lowered the domestic H2 scrap purchase price by JPY 500/MT (USD 5) at three of its five works in Japan. New prices for all grades shall be effective from tomorrow (1st June’19).

The steelmaker had last revised its scrap purchase price 3 weeks ago on 9th May’19, while this is the 8th consecutive price lowering for Tahara and Okayama works since April’19, as local market sentiments remain dull.

With the recent price cut, the company will pay JPY 30,000/MT (USD 276) for H2 scrap delivered at Tahara plant in central Japan and Kyushu works in the Western region while JPY 29,000/MT (USD 266) for Okayama plant. For H2 scrap delivered to Utsunomiya plant in the Kanto region and Takamatsu steel center, price remains unchanged at JPY 29,000/MT and JPY 28,000/MT (USD 257) respectively.

Notably, as per Tokyo steel’s scrap prices maintained with SteelMint, H2 scrap prices for delivery to Tahara and Okayama have reached 5 month low levels, while it remains at around 2 years low levels for Utsunomiya works. For few of the other high grade scrap, purchase price for Takamatsu Steel Center works has been lowered by JYP 500/MT.

Domestic market has not seen much improvement in scrap purchase on account of low finished steel demand, with Trade volumes remaining on lower side. Japanese EAF steelmakers continue to hold H2 scrap prices in the range JPY 29,000-31,000/MT.

Scrap Grade Name of Work of Tokyo Steel 
Tahara  Plant Okayama  Plant Kyushu  Factory Utsunomiya Factory Takamatsu Steel Center
Special Class (H2) 30,000 29,000 30,000 29,000 28,000
First Grade 29,500 28,500 29,500 29,000 27,500
Second Grade 28,000 27,000 28,000 27,500 26,000
New Breaking Press A 33,500 31,000 32,000 31,000 30,000
Shredder A 31,500 29,500 30,500 29,500 28,500
Shredder C 31,000 29,000 30,000 29,000 28,000

Source: Tokyo Steel Reports

 

Daily Update: Indian Semis Prices Volatile on Limited Inquiries

Indian steel prices slightly fluctuated on day trade activities as inquiries was not up to the mark, as reported by participants. The prices of Sponge iron, Billet & Rebars volatile by INR 100-200/MT in across regions in India, through the mid sized mills.

As per manufacturers in central & eastern India, healthy orders received in last couple of days. Hence they are not in hurry to deal and slightly change their offer prices.

SteelMint’s latest price assessment for induction furnaces billet in Indian market stood at INR 30,900-34,600/MT (USD 442-495) ex-plant.

Further, the coal based sponge (78-80 FeM) C-DRI price assessment was at INR 18,800-19,800/MT (USD 268-283); prices are ex-plant & excluding GST.

Rupee & BSE Sensex

— On 31st May 2019 (Friday) INR to USD exchange rate stood at INR 69.74.

— ICEX (Indian Commodity Exchange Ltd) Jun’19 contract for STEELLONG today open at INR 33,320/MT & last traded (IST 18:41) at INR 33,280/MT.

— BSE Sensex closed at 39,714(-117) on Friday, as against last day (Thursday) at 39,831(+329).

— NSE Nifty50 index was closed today at 11,922(-23) & Nifty Metal at 2,900(-24).

RAW MATERIALS

— SAIL (Steel Authority of India Limited) has announced fiscal year end results for FY19. The company’s crude steel output surge by 8% in FY19 to 16.3 MnT as compared to 15 MnT in previous fiscal. Saleable steel production increase by 8% to 15.1 MnT in FY19 as compared to 14.1 MnT in previous fiscal.

— India’s State-owned iron ore miner NMDC plans to spend around USD 1 billion in three years to ramp up production capacity by around 55% to 67 MnT from 43 MnT now.

— As per the latest updates, after acquiring Bhushan Steel in May last year, Tata Steel is also set to take control of its subsidiary Bhushan Energy as NCLT (National Company Law Tribunal) on Thursday approved the resolution plan of Tata Steel to acquire debt-ridden Bhushan Energy for around INR 800 crore.

SEMI FINISHED

— Raipur based sponge plants have quoted P-DRI at INR 18,600-18,800/MT, however deals learned limited at  INR 18,600/MT ex-plant. As per furnace owners, lifting pressure rise from the sponge producers, hence fresh bookings are limited.

— Odisha, Rourkela based sponge manufacturers trading Sponge C-DRI (FeM 80) at INR 18,800-19,000/MT. As per conversation, the producers have healthy bookings in hand, thus not looking significant drop in prices amidst high cost raw materials.

— BMM Ispat, a price trend setter in South Indian sponge market has reported deals for FeM 80 P-DRI lumps at around INR 18,800/MT ex-Bellary; offers are more or less firm against last day (30th May’19).

— SAIL’s pig iron auction today for 3,000 MT steel grade pig iron from Rourkela Steel plant (eastern India) has received quite good response as total allotted quantity has been sold. As per sources, the company had kept base price at INR 27,250/MT, although the material have been fetch high bids of INR 50-100/MT to INR 27,300-27,350/MT ex-plant.

— Rashmi Metaliks in Durgapur has raised sponge P-DRI prices by INR 200/MT to INR 19,000/MT, as reported by sources.

WIRE ROD & PIPE

— Trade discounts in Raipur Wire rod increased by INR 200/MT to INR 1,200-1,400/MT due to surge base price by INR 200/MT to INR 37,700/MT ex-plant. However in Durgapur limited trades have resulted gradual fall in prices by INR 100/MT to INR 36,800-37,500/MT ex-plant.

— Hyderabad (South India) based manufacturer Mahalakshmi Profiles Pvt. Ltd (MPL) has offered ERW Pipe at INR 40,100/MT ex-plant. (basic & excluding GST).

REBAR (12 mm)

— Raipur based – SPEED TMT is offering at INR 35,500/MT (up by INR 100/MT).

— Real Ispat (GK TMT) is offering at INR 37,800/MT (up by INR 200/MT).

— Raigarh based Anjani Steels Ltd. (Radhe TMT) is offering at INR 35,900/MT (up by INR 200/MT).

— Jalna based Bhagyalaxmi Rolling Mill Pvt Ltd (Polaad TMT) has unchanged their offers at INR 36,800/MT.

— Jalna based SRJ Peety Steels Pvt Ltd (Shree Om) has unchanged their offers at INR 36,700/MT.

— South region based Prakash Ferrous Ind. Pvt. Ltd (Tirumala) currently being offered at INR 39,000/MT.

Note – Prices mentioned above are ex-work, excluding GST & changes are placed on day basis. Prices are subject to reconfirmation.

 

Indian Iron Ore Movement Up 6% in Apr’19

As per SteelMint’s analysis, iron ore movement across major producing states of the country recorded at 11.95 MnT (excluding exports) in Apr’19. The iron ore movement has recorded 6% rise against 11.25 MnT in Mar’19. The figures are compiled on the basis of movements made via railways, trucks, and Karnataka and import data as per customs. The figures exclude the captive iron ore movement of SAIL & Tata Steel and movement for exports.

State-wise iron ore movement analysis:

Odisha iron ore dispatches picked up in Apr’19

Odisha- India’s largest iron ore producing state recorded rise in total iron ore dispatches at 6.82 MnT in Apr’19, as against 6.30 MnT in Mar’19. The figures exclude movement for export and dispatches of miners- SAIL & Tata Steel. In the beginning of April’19 Odisha based merchant iron ore miners offered discount amid fresh EC limit for the new fiscal year.

Rungta Mines, recorded highest dispatch at 1.70 MnT in Apr’19, an increase of 28% against 1.33 MnT in Mar’19. OMC dispatches recorded at 0.84 MnT followed by Serajuddin at 0.81 MnT.

Iron ore dispatches from C.G down 32% in Apr’19

Iron ore dispatches from Chhattisgarh recorded at 1.68 MnT iron ore in Apr’19, down as against 2.45 MnT in Mar’19.

NMDC supplied 374 rakes (1.44 MnT) of iron ore for the month of Apr’19, down against 427 rakes (1.64 MnT) a month before in Mar’19.

Karnataka iron ore E-auction sales doubled in Apr’19

Karnataka has registered an increase of 50% in iron ore sales volume in Apr’19 e-auctions against Mar’19. Total iron ore allotted quantity stood at 2.9 MnT in Apr’19 compared to 1.93 MnT in Mar’19.

Vedanta Ltd for the month of April’19 remained the largest iron ore supplier with 37% share of total iron ore sales at 1.08 MnT. NMDC’s iron ore sales increased by 44% M-o-M to 0.62 MnT in April’19 compared to 0.43 MnT in Mar’19.NMDC has temporarily suspended operations at Donimalai in Karnataka since Nov’18.

The major buyer of iron ore in auction included JSW Steel at 2.18 MnT, followed by BMM Ispat at 0.10 MnT and Minera Steel and Power Private Limited at 0.05 MnT.

Indian iron ore imports fell in Apr’19

Indian iron ore imports in Apr’19 have been recorded at 287,500 MT, according to the data maintained by SteelMint. Indian iron ore imports witnessed marginal decline for the month compared to 289,258 MT in Mar’19.

India’s major steel maker– JSW stood the largest importer for the month of Apr’19 at 0.19 MnT as against being nil a month before. Imports were done mostly from Australia and South Africa. Other importers were Chowgule and Company at 0.06 MT and Welspun Steel at 0.04 MT.

India pellet imports recorded at 53,800 MT in Apr’19 from Iran against nil imports a month ago. Since the data maintained with SteelMint, it’s for the first time that India has imported pellets from Iran.

Indian iron ore exports volumes hit 1 year high

Indian iron ore export volumes increased by 14% to 1.36 MnT as against 1.19 MnT in Mar’19. On yearly basis, iron ore export increased by 15% as against 1.18 MnT in the month of Apr’18 last year. Iron ore exports from India have climbed to 1-year high as similar level of exports was last seen in Mar’18 at 2.63 MnT. The exports volume picked up amid increased Chinese demand for low & medium grade iron ore and supply constraints from Brazil and Australia.

SM Niryat stood largest iron ore exporter in April’19 at 0.38 MnT, (up 52% M-o-M). MMTC (which exports on behalf of NMDC) stood second largest and its exports increased by 10% to 0.23 MnT for the month. Other major exporters were Bagadiya Brother at 0.17 MnT, Fomento Resources at 0.15 MnT and Rungta mines at 0.12 MnT

Indian pellet exports dropped amid reduced Chinese demand

Indian pellet export volumes for Apr’19 have been recorded at 0.88 MnT, down 25% on monthly basis as against 1.17 MnT a month ago. The pellet exports fell due to domestic availability of pellets in China and preference for lumps over pellets.

BRPL stood the largest pellet exporter in Apr’19 with exports at 0.24 MnT, up 4% as against 0.23 MnT in Mar’19. KIOCL stood second largest exporter at 0.17 MnT (down 28% M-o-M), followed by Essar Steel at 0.12 MnT and Rashmi Metaliks at 0.11 MnT. Other exporters were JSPL, Godavari Power, and others.

India Iron Ore Movement

 State April’19 March’19
 Odisha 6.82 6.30
 Karnataka 2.90 1.93
 Chhattisgarh 1.68 2.45
 Jharkhand 0.22 0.27
 Import 0.34 0.29
 Export 2.24 2.36

Qty in MnT, Import and Export Fig includes pellet
Excluding SAIL & Tata Captive procurement
Source: SteelMint Research

 

India: Ferro Silicon Prices May Fall Further Owing To Low Demand

Indian Ferro Silicon Prices remains unchanged this week amid low demand. Sellers are under pressure due to persistent low demand while few producers are lowering the prices from the standard to entice buyers.

Ferro Silicon prices in May ended up at INR 71,000/MT for Ex-Guwahati. Producers in Bhutan are offering Ferro Silicon at around INR69,000/MT. In the export market, prices remained unchanged and stood at USD 1160/MT FOB Kolkata. Prices in the domestic market fell consistently owing to the low demand.

On the future outlook, producers remain pessimistic about any uptrend in the prices. Moreover, market participants believe that the prices may go further down in the next week owing to the lengthy period of low demand.

 
Japan Coal Imports

Japan: Coal Imports Down 3% M-o-M in Apr’19

Japanese coal imports have decreased 3% on the month in Apr’19, following a hefty fall in non-coking coal intake during the month.

Data provided by custom indicate that the country had imported 15.55 MnT coal in Apr’19 against 16.11 MnT in Mar’19. Imports, however, were slightly higher on the year from 15.4 MnT in Apr’18.

The country had reported its highest monthly coking coal imports for CY19 in Apr’19, but it was not enough to overcome the slump in non-coking coal shipments.

A grade-wise break-up of coal imports show the non-coking coal receipt in Apr’19 dropped 10% M-o-M to 9.96 MnT against 11.07 MnT in Mar’19. Apparently, non-coking coal shipment had fell to 9 MnT mark for the first time since Jun’18.

Imports of Coking coal had increased 11% M-o-M to 4.01 MnT in Apr’19. Besides, there was an upsurge noted in Anthracite coal imports, which were recorded at 0.5 MnT during the month.

Among imports of coke commodities, Pet coke shipments had slipped a tad mo-m, while Met coke shipments had jumped nearly 4-folds to 0.08 MnT during Apr’19.

Grades Apr’19 Mar’19 % Change
Non Coking Coal 9.96 11.07 -10%
Coking Coal 4.01 3.62 11%
Anthracite 0.5 0.4 25%
Pet Coke 0.39 0.4 -3%
Met Coke 0.08 0.02 300%
Others 0.61 0.6 2%
Grand Total 15.55 16.11 -3%

Source: Japanese customs
Quantity in MnT

Major Coal Exporters:
Australia, Indonesia and Russia remained the top-3 major coal suppliers to Japan. However, only Russia had managed to post a monthly growth in exports during Apr’19.

Australian coal export to Japan fell 2% M-o-M to 9.01 MnT in Apr’19, which was also 5% lower on the year from 9.48 MnT in Apr’18.

Indonesian coal exports were down 18% M-o-M to 1.87 MnT in Apr’19, but were 13% higher on the year from 1.66 MnT in Apr’18.

Russian coal supplies increased 3% on the month to 1.71 MnT, while rising 17% Y-o-Y in Apr’19.

Coal supplies from Canada doubled during the month to 1.26 MnT, while that from the US had fallen 48% M-o-M during Apr’19.

Japan country-wise Coal Imports

In total, Japan has accumulated 63.34 MnT coal imports during the first 4 months of CY19.

 

SE Asia Billet Market Update – Week 22, 2019

Turkey’s scrap import prices witnessed a decline this week; a drop of USD 8-10 is reported against last week. SteelMint’s assessment for US origin HMS (80:20) stands at USD 304/MT, CFR Turkey, lower by around USD 8- 10 against last week. This drop is weakening the billet trade sentiments in SE Asia.

CIS nations have pulled down their billet offers this week and are assessed at USD 425-430/MT, FoB Black Sea. Last week offers were heard in the range of USD 430-435/MT, FoB Black Sea.

Iran-SE Asia billet trade- In recent, a deal has been concluded to SE Asia from Iran, sources reported to SteelMint. The deal quantity was reported to be 30,000 MT billet at around USD 390/MT, FoB. The shipment is scheduled for Jul’19. Now fresh offers from major Iranian mills stands at USD 395/MT, FoB.

Vietnam billet offers – This week Vietnam billet (130*130mm, 5 SP grade) offers were reported to be USD 460/MT, CFR Manila. The trade sentiments are reported marginally weak in Vietnam, this week.

 

India: SAIL Receives Good Response in Pig Iron Auction

SAIL’s pig iron auction conducted today for 3,000 MT steel grade pig iron from its Rourkela Steel plant (eastern India) has received quite good response as total allotted quantity has been sold out with a increase of INR 50-100/MT over the base price.

As per sources, in today’s auction the company had kept base price at INR 27,250/MT, although the material have been fetch high bids of INR 50-100/MT to INR 27,300-27,350/MT and total of 3,000 MT material have been sold out on ex-plant basis.

The response was good in line with rally steel (Billet) prices. In addition, short supply by private mills in neighboring markets is another key factor behind fetching good response in this auction.

The private mills in eastern India, Jharkhand have halted bookings in previous price of INR 27,500/MT and looking the price range of INR 28,000/MT ex-plant.

Similarly in Durgapur where couple of merchant pig iron suppliers have raised offers to INR 28,300-28,500/MT as against last week at INR 27,500-28,000/MT ex-plant. Meanwhile in Jajpur, Odisha offers through the Mesco Steels heard at INR 27,000-27,200/MT ex-plant.

SAIL is India’s largest steel producer in terms of capacity which is about 21 MnT per annum. Meanwhile in context to Pig iron NINL is the largest merchant producer of pig iron with an annual hot metal production capacity of about 1.1 MnT.

NINL’s (Neelachal Ispat Nigam Ltd) fresh offers are due since 12th May’19 and as per sources the company likely to release prices in coming week. Last domestic offers by NINL was at INR 27,000-27,400/MT ex-plant, Cuttack, Odisha.

 

Chinese Domestic Steel Market Update, 31 May’19

Billet: Yesterday the ex-factory price of general carbon billet in Tangshan, Changli and Qian’an was settled at RMB 3,560/MT, down RMB 40. Today, the steel market is in weak operation, with insufficient transactions on billets and the finished product prices inclines to weaken. Mill direct sale is weak. The price of ex-warehouse spot is offered at RMB 3,620/MT tax-inclusive with a few transactions. The billet inventory at warehouse of Xiangyu Zhengfeng and Haiyi Hongrun stands 205,100 MT, down 5,400 MT. The overall shipment of finished steels are inadequate, and it is expected that billet price may drop by RMB 20-30 in the afternoon

Construction steel: The mainstream prices of construction steel on Tangshan market are stable. The current market price of rebar HRB 400 of big specification is at RMB 3,960/MT, small specification at RMB 4,000/MT, while coiled rebar at RMB 4,070/MT up RMB 30. Transactions are weak.