Monthly Archives: January 2021

India: Odisha cracks down on excess mining, more notices issued

Seven iron ore miners, including Sarda mines and Essel, have been issued with steep penalties for violating their EC limits on a prorata basis. As SteelMint reported recently, Sarda Mines has been asked to pay a differential amount of Rs 2056.4 crore, SteelMint has learned that Essel Mining, Tantra mine of Korp Resources, Gita Rani, BD Patnaik’s Banspani mine, AMTC and National Entreprises have all been issued demand notices on similar grounds. While IDCOL has been show-caused.

The logic behind these notices is that if a miner is allowed 6mt and is left with 4 months of the year, then he may only mine half a million tonnes a month or 2 mn tonnes in four months. This ‘stipulation’ is based on a Supreme Court-appointed Committee’s report in the Common Cause (Odisha mining) matter.

Parallelly, the Centre has moved to clarify that new lessees who have bagged rights through an auction process and are required to extract 80 per cent of their ECs, can meet this target on a quarterly basis and need not be held accountable at the end of every month. The Odisha government had shown-caused miners for the shortfall calculated on a monthly basis, while miners were arguing the MDPA should be considered an annual target like other production-linked permits such as their Environmental Clearance.

SteelMint has learnt that the demand notices will not lead to an immediate stoppage of work; miners have been given 15 days to comply.

It is important to note that this demand, invoking Section 21(5) of the MMDR (and made after 7-8 months in Sarda Mine’s case for example), is being made even as the union Cabinet has approved an amendment that is set to rewrite the very same section of the law. The section defines “illegal mining” which is to be penalized by reclaiming the entire value of the ore. Having in the past decided that a violation any statutory clearance (under environment and forest acts, pollution control act or mining plan) amounted to illegal mining, the Centre now seeks to take a previously held position that such lapses should be seen as “irregular” and not illegal mining.

 

India: SAIL notches up impressive numbers in Q3 FY’21

Indian Govt. owned SAIL (Steel Authority of India Limited) has announced its financial and operational results for Q3 FY’21 and 9M FY’21. On a quarterly basis, hot metal production was up by 16% to 4.80 mn t while saleable steel production spiked by 11% to 4.15 mn t in Q3 FY ’21. Sales volumes recorded at 4.32mn t increased by 3% compared to the previous quarter.

Major takeaways of the investor conference call:

1.Company targets 17 mn t sales guidance for next fiscal
Company announced that it is eyeing to achieve 17 mn t in saleable steel sales and around 20 mn t in hot metal production in FY’22.

2.SAIL posts splendid Q3 earnings
Company reported a significant increase in its key performance indicators for Q3 FY’21. The Company’s EBITDA stands at INR 5,294 cr, up by a humongous 346% annually, while PAT grew by a whopping 398% annually to INR 1,283 cr.

3.Operational performance
The focus on operational efficiency also resulted in improvement in the key techno-economic parameters during 9M FY’21. Coke Rate 454kg/t, Blast Furnace Productivity at 1.78 T/m3/Day and Specific Energy consumption 6.59 G.Cal/TCS were impressive.

4.Expect iron ore sales to pick up in Q4 FY’21
SAIL recorded iron ore sales of around 1.2 mn t in Q3 FY’21 vis-a-vis 0.5 mn t in Q2. The company expects sales volume to rise to 2 mn t in Q4. The company continues to await some approvals from the Jharkhand Govt. which once resolved will push sales monthly volumes to 1mn t.

5.Coking coal prices are expected to soften-
Imported coking coal prices stood around $135/t FoB Australia last week. SAIL expects it to touch around $125/t Fob basis in the near term. Few coking coal deals have been booked at higher prices recently but the company is expecting that higher levels will not sustain for long.

6.Net sales realization improves in Q3 FY’20-
In long steel net sales realization was around INR 39,360/t in Q3FY’20 which has now touched INR 46,000/t in Jan ’21. Similarly, in flats, net sales realization was at INR 43,000/t in Q3 and touched to INR 50,574/t in Jan’21

7.Reduction in price gap-
Company in its recent investors’ call mentioned that the price gap between primary and secondary players has touched around INR 8000-9000/t when prices were increasing significantly. However, this gap is expected to reduce by around INR 3000-4000/t in the near term amid softness in long steel prices.

8.Maintenance shutdown in IISCO plant-
IISCO plant is planning a maintenance shut down for around 20 days in two phases:10 days in Mar’21 and 10 days in Apr’21.

Better outlook in Q4
Company expects better results and performance in Q4 FY’21 in terms of prices. The benefit of imported coking coal at cheaper prices will continue to impact in Q4 also. Meanwhile, boost in demand from infrastructure and construction will help SAIL to better its numbers in upcoming quarters.

 

Weekly: Global billet market overview

The global billet prices saw a significant drop this week. However, sizeable billets reported having traded this week with a price drop of $30-40 amid sharply decreased global scrap prices. But the majority of the buyers are seen in a wait-and-watch mode until the Chinese New-Year holidays as they are anticipating a further dip in prices.

CIS- This week, CIS offers witnessed a further fall of $10-15 and are currently at $550/t, FoB Black Sea.

India- SteelMint’s bi-weekly assessment for Indian billets (150*150mm, BF route, FoB east coast) is currently at $530-535/t.

  • Billet export prices saw a significant w-o-w fall of $35-40 in a recently hosted tender by an Indian state-owned mill. The mill reported having booked 30,000 t billets (150*150mm, 3SP/4SP) through a spot sale tender at $530-535/t, FoB for Mar’21 shipment, credible sources reported to SteelMint. Prices have come down by around $40 against its previous tender concluded in early Jan’21 at around $575-576/t FoB for mid-Feb shipment.
  • The secondary Indian mills have turned active in the export market and are actively exploring opportunities for billet export after a continuous price drop in domestic prices.
  • The high BF-IF route price spread led the secondary mills to increase their export allocations. However, we feel that the continuous falling global scrap prices will not let them enjoy the price realizations in the export market. It (falling global scrap prices) will create bid-offer disparity and could result in canceling the deals. Notably, we heard more about the offerings, but the contracts witnessed were limited.

Iran- SteelMint’s bi-weekly assessment for Iranian billets is $535-540/t, down by $20-25/t against last week.

  • Iranian billet export prices witnessed a sharp drop in recently concluded tenders by the country’s two leading steel exporting mills. The continuous falling scrap prices pulled the Iranian billet export prices.
  • Meanwhile, against the odds, two leading steel exporting mills- Chadormalu Mining and Industrial Company and Khouzestan Steel Company (KSC) managed to book 60,000 t billets. However, the bookings witnessed a price drop of $20-25 w-o-w. According to SteelMint sources, KSC managed to achieve price levels of $540/t FoB for the Far East, while Chadormalu concluded the tender at $530-535/t, FoB.
  • Domestic billet trades at IME improve – On the other hand, the domestic billet demand saw a rebound this week. Around 107,000 billets were traded at the Iranian Mercantile Exchange (IME), at an average price of IRR 101,761/kg ($435/t). The offered quantity was 132,705 t.

  • However, the marketers are not considering this week’s IME trades as a demand rebound. Because for this week, IME price was a function of 75% of the CIS price. Generally, it is 80% of the CIS price. The Iranian Government did this to encourage buying and to raise the demand. Over the past two weeks, limited or negligible billets were reported having traded at the IME.
  • “Next week will be interesting to gauge the actual demand as people might have over-stocked owing to reduced prices”. SteelMint learned during conversations with market participants.

SE Asia- This week, SteelMint assessment for billet imports in SE Asia is $560-570/t CFR, down by $30-40 w-o-w.

  • Imported billet prices in SE Asia witnessed a significant drop amid global downtrends and lower bids.
  • SE Asian buyers are currently in a wait-and-watch mode until the Chinese New-Year holidays as they are anticipating a further dip in prices. We also learned that Indonesia has temporarily opted out from the market as local billets are reasonable and following the downward trend. An Indonesian trader shared this input with SteelMint.
  • Vietnam- Following global trends, Vietnamese billet export offers witnessed a sharp drop of $ 15-20 this week. The BF route billets were heard being offered at $565/t, FoB, while the IF route was at $560/t, FoB Vietnam.
  • Thailand- The imported billet offers in the country were ranging from $570-580/t, CFR, down by $20-25 w-o-w.

Chinese domestic billet prices increase by RMB 50/t- This week, the billet prices in the Tangshan market (northeast China) settled with a rise of RMB 50, against last week. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,860/t ($600/t) in Tangshan, including 13 % VAT.

Global billet market snapshot-

 

Japan: Ferroalloys imports down by 23% y-o-y in CY 20

Japanese ferroalloys imports decreased by 23% in CY 20 due to reduced production of crude steel. Japanese Crude steel production dipped by 16% y-o-y in CY20. South Africa, Kazakhstan Australia and Russia were the top four contributors to Japanese ferroalloys imports. Meanwhile, in Dec ’20, manganese ore imports suffered the most as compared to the previous month due to overstocking of ores and limited buying interest. On the contrary, ferrochrome imports doubled before new year holidays from Japan.

 

Weekly: Indian iron ore market overview

SteelMint’s benchmark Odisha iron ore fines index fell this week. Market participants expect prices to come down further in coming days on improved supply and sharp decline in semi-finished and finished steel prices. However, most of the buyers and sellers have kept away from concluding trades this week and are waiting for budget announcement, anticipating some changes in duty structure.

SteelMint’s index for Odisha iron ore fines (Fe 62%) index stands at INR 5,900/t (ex-mines, including Royalty, DMF & NMET), lower by INR 100/t w-o-w.

SteelMint has also received nine offers, indicative prices in this publishing window out of those seven taken into consideration. To see SteelMint’s iron ore assessments, pricing methodology and specification documents, Click here.

  • Govt owned steelmaker- Steel Authority of India Ltd (SAIL) conducted an auction from its Bolani mines for 104,000 iron ore fines (Fe 62.5%). Out of the offered quantity, only 72,000t received bids at base price i.e at INR 4,250/t (loaded into rakes and excluding royalty, DMF & NMET). However, the bids have dropped by upto INR 750/t against last auction on 15 Jan’21.
  • Odisha Mining Corp (OMC) has scheduled its next iron ore e-auction on 1st Feb’21. The auction is being conducted for 933,000 t iron ore lumps. The miner has increased the base price by up to INR 1,500/t against last auction’s base price held on 2nd Dec’20.
  • Sarda Mines has been slapped with a demand of INR 2056,38,43,567 for producing the permitted annual limit of Thakurani B iron ore block in February and March of 2020.

Chhattisgarh-: NMDC conducted iron ore e-auctions for 701,400t iron ore from its Chhattisgarh mines. Offered quantity comprised of 600,000 t of fines, 50,400 t DR CLO and rest comprised of lump and ROM. The DR-CLO lots received a good response and bids increased by around INR 1,300/t over the set base price. However, the fines lot received a weak response with just two rakes getting booked at base price.

Karnataka -: NMDC Kumarswamy mines conducted an iron ore e-auction on 22nd Jan’21. Out of the total 428,000 t put to auction 344,000 t iron ore was booked. JSW Steel bought 172,000 t iron ore in the auction followed by Arjas Steel Private Limited at 48,000 t. The bids in the auction were almost in line with base price.

India iron ore prices-:

 

Weekly: Indian steel market snapshot

India’s secondary steel market has marked further fall in prices during this week due to mismatch in supply chain as demand continued to remain subdued, while supply remains strong.

As per the assessment, Indian semi-finished market has observed a fall in prices of around INR 300-600/t in sponge iron and INR 700-2,000/t in billet during week 5. Also, finished long steel prices dropped by INR 800-1,900/t w-o-w in rebar due to lack of buying inquiries and trade activities, with a sharp fall noticed in the southern region, Chennai by INR 2,700/t.

In line with this, domestic HRC & CRC prices in trade segment declined by around INR 1,500-3,000/t due to sluggish demand and stalled purchases in the market.

Iron Ore and Pellet

Odisha Mining Corp (OMC) has scheduled its next iron ore e-auction on 1st Feb’21. The auction is being conducted for 933,000 t iron ore lumps. The miner has increased the base price by up to INR 1,500/t against last auction’s base price held on 2nd Dec’20.

  • Sarda Mines has been slapped with a demand of INR 2056 cr for producing the permitted annual limit of Thakurani B iron ore block in February and March of 2020.
  • NMDC conducted iron ore e-auctions for 701,400t iron ore from its Chhattisgarh mines. Offered quantity comprised of 600,000 t of fines, 50,400 t DR CLO and rest comprised of lump and ROM. The DR-CLO lots received a good response and bids increased by around INR 1,300/t over the set base price. However, the fines lot received a weak response with just two rakes getting booked at base price.
  • SteelMint’s bi-weekly domestic pellet index “PELLEX ” remains stable at INR 12,100/t DAP Raipur.
  • SteelMint’s weekly low-grade Indian iron ore fines (Fe 57%) export index fell by around $6/t this week and is currently assessed at $94/t FoB east coast India.
  • SteelMint’s weekly pellet export index (FOB east coast India) has dropped to $194/t after hitting all-time high levels of $196/t. The index has come down by $2/t w-o-w. The drop in the index is attributed to lower bids from Chinese end-users ahead of approaching holidays and falling global iron ore prices. Chinese lunar New Year holidays, and approaching Chinese spring festival have kept buying inquiries on the lower side.

Coal

  • Australian coking coal prices have continued to gain sharply this week following spot transactions concluded at higher levels, and with higher firm bids seen in the ex-Chinese market.
  • Two trades for 75,000 t each of PLV HCC cargoes were concluded on Wednesday 27 Jan’21, at $155/t and $154/t FOB Australia, with early-mid March laycan.
  • Another spot deal for 75,000 t with early-March laycan was concluded on Tuesday 26 Jan’21 at $151/t FoB Australia.
  • Rising restocking demand and buyers’ concerns over potential supply disruptions during Australia’s cyclone season are key factors behind the recent rally in prices.
  • Competitively priced Australian cargoes relative to Atlantic coals of similar grades is also supporting prices thereof.
  • Latest prices for the Premium HCC grade are assessed at around $160.50/t FOB Australia, $219.00/t CNF China and $174.80/t CNF India.

Ferrous Scrap

Imported scrap market in India continued to remain in limbo. Most of the mills are procuring domestic scrap & sponge iron as it is more costeffective. Due to the weak Indian domestic market, mills are not booking any cargo currently and have adopted a wait- and- watch approach for the time being, SteelMint learnt from its sources. Buyers are also cautious as the budget announcements are round the corner.

  • SteelMint’s assessment for containerised shredded stands at $420/t CFR Nhava Sheva level, down by $15/t w-o-w.
  • All the trades are taking place in the high seas for cargoes which were bought last month by Indian traders or suppliers, SteelMint learnt.

Ferro Alloys

  • Indian silico manganese prices went down owing to dull demand in the domestic market. Meanwhile, producers are eagerly waiting for the MOIL prices which is expected to increase to maintain the price parity with the imported ores.
  • Ferro manganese prices went down in Raipur and Durgapur, due to moderate demand in the domestic market. The prices are downtrending amidst lowering steel prices.
  • Ferro chrome prices remained stable at INR 95,000/t in the week, due to tepid buying interest in the domestic market. Buyers are waiting for the Chinese New year, as they expect the prices to fall as Chinese return after holidays.
  • Indian ferro silicon prices came down due to dull demand in the domestic market. However, increasing international prices and no imports are keeping the sentiments positive but the prices might slow down on reduced buying.

Semi Finished

This week, sponge iron offers fell by INR 300-600/t, however billet prices drop sharply by INR 700-2,000/t across regions with a major fall in billet prices reported in South India (Chennai) by INR 2,700/t & by INR 1,200-1,500/t in Eastern region.

Following a significant fall in prices, the conversion spread (margins) dipped of sponge iron & billet makers by INR 1,000-2,000/t during the last week of Jan’21 & with lessened margins, the standalone plants are planning to cut production to balance supply-demand as well margins.

  • Induction grade billet export offers to Nepal drop by $25-30/t this week to $470-475/t exw Durgapur (equivalent to $495-500/t CPT Nepal). Participants claim few deals yesterday at $470-472/t exw Durgapur.
  • Indian sponge iron export prices fell by $15/t to $340-345/t CPT Benapole (equivalent to $355-360/t CFR Chittagong, Bangladesh). However, about 7,000 t deals reported during the mid of week at $355/t CPT Benapole.
  • Steel grade pig iron prices declined by INR 700-2,000/t on account of constant fall in billet prices. Participants assuming, prices to dip further as supply remains healthy & the major buyers are still out of the market.
  • SAIL conducted a pig iron auction from its Rourkela Steel Plant for 5,400 t material on 30 Jan ’21 & bids have been lowered by INR 2,800-2,900/t to INR 30,450/t exw, compared with previous auction held on 22 Jan’21.
  • An eastern India based private steel mill has booked two parcels (50,000 t) of granulated pig iron (C-5% max, Si- 1.5%, S – 0.09%) for export last week. The price indications for the deal were heard around $480/t FoB India. Indian mill reported having booked 30,000 t billets (150*150mm, 3SP/4SP) through a spot sale tender at $530-535/t, FoB. Prices have come down by around $40 against its previous tender concluded in early Jan’21 at around $575-576/t FoB.

Finished Long

India’s finish long steel market via induction route observed lack of buying inquiries and trade activities in this week as well, and in most of the major supplying regions rebar manufacturers reduced their offer by INR 800-1,900/t w-o-w basis except in Raigarh (Central region) market where the prices decreased marginally by INR 200/t owing to lowered offer comparatively to other market, while in Chennai market of Southern region to maintain the price parity of other competitive markets rebar prices sharply declined over INR 2,500/t. As per trade sources, along with lack of demand, reducing raw material cost are also a major factor behind lowered long steel prices.

  • Trade reference rebar prices of 10-25 mm through midsized mills assessed at INR 38,800-39,000/t exw Raipur, INR 42,900-43,300/t exw Jalna.
  • Trade discount given by Raipur based heavy structural steel manufacturers is stood at INR 800-1,200/t and trade reference price of 200 mm Angle is at INR 41,800-42,200/t exw Raipur.
  • Trade discounts in Raipur wire rod are currently at INR 1,600-1,800/t and trade reference prices stood at INR 37,200-37,400/t exw Raipur, INR 38,600-39,000 exw Durgapur, size 5.5 mm.

Finished Flat

Domestic HRC & CRC price decline on sluggish trades: Regional prices of HRC and CRC reported a sharp decline by around INR 1,500-3,000/t ($20-41) due to sluggish demand and stalled purchases in the domestic market.

SteelMint’s trade reference prices are mentioned below:

  • HRC (IS2062 2.5-8mm) stood at INR 55,000-56,000/t exy Mumbai, INR 53,000-54,000/t exy Delhi, and INR 57,000-58,000/t exy Chennai.
  • CRC (0.9 mm GR) is around INR 67,000-68,000/t exy Mumbai, INR 62,500-67,000/t exy Delhi, and INR 67,000-71,000/t exy Chennai.

Factors behind price decline –

  • Traders are reluctant to purchase material at higher prices since they have enough inventories at the moment.
  • The premium between the mill price and trade prices is very low due to which trader’s profit margin is affected.
  • The 2nd price hike didn’t get absorbed in the market. In the mid of Jan’20, few major steel mills announced the second hike of around INR 2000/t on supply constraints.

Outlook – Major steel mills are planning to increase domestic flat steel prices by around INR 1,000-1,500/t in the near term to maintain the momentum.

Reference Prices as on 30 Jan’21 (Week 5)
Prices are exw & exclusive of GST

Indian export reference prices as on 30 Jan’21
Prices in $/t
Source: SteelMint Research

 

Weekly: Volatility amid fluctuations in futures market witnessed in Chinese steel markets

The nation’s steel prices exhibited volatility during the week amid fluctuations in the futures market. However, Chinese New Year holidays scheduled from 11th Feb has a dampening effect on market sentiments.

Feed materials like coking coal along with spot pellet premiums, spot lump premiums and billet prices witnessed an increase during the week.

Chinese steel market highlights-

China’s spot iron ore price dropped during the week- Chinese spot iron ore prices opened at $168.5/ t this week but slipped to $158.05 towards the weekend. Iron ore prices dropped on lower steel margins. Mid-week the prices had fallen to $156.20/t but picked towards the weekend due to forecasts of a tropical cyclone in Western Australia. Most mills have finished up with restocking ahead of New Year holidays.

As per data compiled by SteelHome consultancy, iron ore inventory at major Chinese ports was at 126.2 mn t against 125.5 mn t assessed a week ago.

Spot pellet premium up w-o-w-Spot pellet premium for Fe 65% grade pellets was at $52.95/t, up against last week prices at $ 51.25/t. The prices for pellets surged on the back of tight supply. China is increasing demand for pellets, due to the higher-grade iron content and environmental benefits from pellets, compared with sintered iron ore fines which use carbon fuels such as coke breeze and anthracite.

As per data compiled by SteelHome consultancy, pellet inventory at major Chinese ports dropped to 5.7 mn t this week as against 5.9 mn t assessed a week ago.

Spot Lump premium moves up on increased preference- Spot Lump premium was witnessed at $ 0.3825/dmtu against $ 0.3700/dmtu last week. Lump demand has surged aggressively on sintering restrictions in Tangshan.

Coking coal increases sharply-Seaborne coking coal prices have continued to gain sharply this week following spot transactions concluded at higher levels and higher firm bids from importers.

Two trades for 75,000 t each of PLV HCC cargoes were concluded on 27 Jan’21, at $155/t and $154/t FoB Australia, with early-mid March delivery.

Another spot deal for 75,000 t with early-March delivery was concluded on 26 Jan’21 at $151/t FoB Australia.

Rising restocking demand and buyers’ concern over potential supply disruptions during Australia’s cyclone season are key factors behind the recent rally in prices. Further, the competitively priced Australian cargoes relative to Atlantic coals of similar grades are also supporting prices.

The latest price for the Premium HCC grade is assessed at around $160.50/t FoB Australia in contrast with $135.50/t FoB basis a week ago.

Domestic billet prices up w-o-w- This week, billet prices in the Tangshan market (Northeast China) settled with a rise of RMB 50, against last week. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,860/t ($600/t) in Tangshan, including 13 % VAT.

HRC export offer range expands over the week- Chinese HRC export offer started to decline with the commencement of this week due to bearish domestic market sentiments. However, the offers witnessed a rebound towards the end of the current week.

HRC export offers stood at $630-650/t FoB China compared to $630-640/t FoB basis a week back.

Multiple factors have had their impact on the price direction-

  • China’s Chamber of commerce for Metallurgical Enterprises relayed its concerns over Iron Ore Futures market speculation and might roll out a plea to the Beijing Government to reduce export rebate putting a leash on production volumes.
  • Ministry of Industry and Information Technology (MIIT) in a bid to reduce carbon emissions might forbid an increase in steel capacity while encouraging mergers and acquisitions.

Domestic market prices for the week were pulled down by RMB 20/t w-o-w to RMB 4,440-4,460/t (Eastern China) as against RMB 4,460-4,480/t (Eastern China) a week ago.

Rebar export offer moves down slightly- Chinese exporters have cut their offers to $630-640/t FoB China against $635-645/t FoB basis in the preceding week.

A dip in domestic market demand motivated mills to shift focus to overseas markets. On the other hand, importers were heard bidding on the lower side at $610-620/t FoB China, resulting in mute trades.

The domestic market prices were reported at RMB 4,110-4,160/t (Northern China), up by RMB 50/t against RMB 4,060-4,160/t (Northern China) in the previous week. Domestic market prices gained support from the uptrend in futures market on the fact that MIIT announced measures to cut output coupled with the mills reducing production volumes to cut down their losses due to higher input costs.

 

China: Weekly coal and coke market highlights

Metallurgical coke prices continue to remain well supported on tight supplies in China, as steel mills have accepted the 15th round of price uptick proposed by coking plants.

CoalMint assessed the latest price for domestic met coke with 12.5% ash in North China at CNY 2,920/t ($457.44/t), up CNY 100/t ($13.99/t) on the week.

Trading activity likely to slow but outlook on coke market still positive—

Mixed sentiments were observed in the spot market of coke as some mills in Shanxi province proposed to lower CNY 100/t on coke purchase price, while coking enterprises in Hebei, Jiangsu, Shanxi and Shandong proposed the 15th round of price hike by CNY 100/t.

Steel mills, however, are still showing active interest in procuring coke supplies considering the hassles of interrupted logistics in Hebei province amid Covid concerns, the stockpiling need as Spring Festival approaches, and the possible snowy weather prevailing thereafter, boosting optimism amongst coke enterprises.

A few local coking coal producing collieries in Shanxin and Inner Mongolia are already on holiday, while collieries in Shanxi’s Lvliang, Jinzhong and Taiyuan will stop operation in early February. However, most state-owned collieries will remain operational during the upcoming holidays.

As for imported coal, the daily passage of vehicles at the Mongolia border witnessed a notable increase.

Meanwhile, United States and Canadian spot coking coal prices could remain strong during the first half of 2021 as trade tensions between China and Australia continue, boosting those origins, while Australian shippers seek customers in Europe and Latin America.

Chinese buyers including traders and end users are likely to wait until post-Spring Festival to resume full-scale trading activities.

~

By Aditya Sinha

 

SteelMint: India’s domestic steel scrap index remains stable

SteelMint’s domestic steel scrap index has observed stability after yesterday’s sharp decline and is currently assessed at INR 29,500/t DAP Mandi Gobindgarh basis. Tighter domestic scrap supply seen from the last 4-5 days led to firm price range today despite marginal price correction in semi-finished steel.

Today, 10 sets of trades, indicative prices/bids/offers were recorded in the publishing window.

The Index also derives the HMS 80:20 scrap (Heavy, Med), and CR Sheet cutting prices traded in the region.

Scrap Grade and Spread Calculation: (Mandi Gobindgarh)

Scrap Type Name Yield Price Min Max
HMS 80-20 (Selected) 94-95% 27,400 27,300 27,600
End Cutting (Structure/Rebar) INDEX 97-98% 29,500 29,400 29,800
CR Sheet Cutting 99% 30,900 30,800 31,200
Pipe Cutting 96-97% 28,900 28,700 29,100

Prices in INR/t, DAP (Delivered at Plant)

To see SteelMint’s Melting Scrap Assessment, pricing methodology and specification documents, Click here

What is SteelMint Indian scrap index – SteelMint’s assessment of Mandi scrap reflects the prices of different melting HMS grade generated and traded in the domestic market. SteelMint gathers and verifies information from buyers and sellers active in the physical spot market. The data obtained by SteelMint, are normalized for yield, dimensions, density, location and other terms of trade to the specifications.

Why this index? India’s National Steel Recycling policy mentioned that the efficient use of scrap for steel production becomes very crucial for India as 35-40% share has been envisaged from scrap-based steel production in the journey of 300 mn t pa by 2030. This shall increase the requirement of steel scrap sharply from the present level of around 30 mn t.

Methodology – Market data, including deals, bids, and offers that meet the delivery and quality criteria are considered for price assessments. The highest importance in the price calculation process is assigned to confirmed deals (T1) where either a buyer or seller has provided details of the transaction. Deals of only reputed and trustworthy producers and trading firms are included in the price collection and calculation process. Indicative prices, confirmed bids and offers are also considered valuable for the pricing process (T2). The index has been calculated using an average of T1 and T2 price inputs.

To provide feedback on this index or if you would like to contribute by becoming a data partner, please contact – info@steelmint.com

 

SteelMint billet index drop further by INR 450/t – 30 Jan

SteelMint daily billet index has been assessed at INR 33,900/t (-450) exw Raipur on 30th Jan’21, 16:00 IST.

A total of about 2,500 t billet trades were recorded today, as against 1,700 t yesterday (i.e. 29th Jan).

  • This index has been derived based on transactions, offers, bids and indicative price data sets. Transactions are considered as T1 and given a weightage of 50% whereas other data sets are considered as T2 and given a weightage of the balance 50%.
  • Transactions (T1)– Five trades were recorded in the 11:30 am to 3.30 pm SteelMint trading window and considered for final price calculation as T1 inputs. Three trades were recorded at INR 34,000/t & one deal each at INR 33,600/t & INR 34,100/t. The average price of these five transactions was INR 33,936/t and given a 50% weightage in the final price calculation.
  • Other Price Indicators – bids/offers/indicative (T2)– Eleven offers reported in the trading window and considered as T2 inputs. The average price of these eleven was INR 33,910/t and given a 50% weightage in the final price calculation.

The final price for billet exw Raipur was at INR 33,923/t, rounded to INR 33,900/t exw.

For detailed methodology – Click here

T1: Trade
T2: Offer/Bid/Indicative