Indian Steel Market Weekly Snapshot

The participants stated that, demand for finished products was comparatively lower in few parts of the country which led to surge in inventories. Hence this resulted in putting pressure on semi-finished steel prices too.

As per SteelMint's assessment, during the week Rebar prices moved down by INR 500-1,000/MT (USD 7-14), Billet by INR 300-800/MT (USD 4-12) & Sponge iron by INR 200-600/MT (USD 3-9).

In context to Flat steel, the base prices unaltered this week, however trade discounts are expected to announced by major mills to improve trade volumes.

IRON ORE & PELLETS

As per sources, iron ore prices in Odisha remains unchanged this week. Though SteelMint learned from the sources, that 5-18 lumps price is trading at around INR 3,700-4,000/MT. Odisha state merchant miners – OMC has rescheduled its iron ore fines auction next week which was earlier scheduled on 7th May 2019 owing to Cyclone Fani hit Odisha last week.

Pellet prices in Indian domestic market remain supported amid logistics issues in Iron ore. In Durgapur (Eastern India) reference pellet price assessment stands at INR 5,800-5,900/MT (delivered) in line with the last week assessment. Currently Raipur pellet offers at INR 6,600/MT against  INR 6,400/MT at the beginning of this week .

Indian pellet export market seems to be strengthening this week. SteelMint has learned from trade sources that Chinese mills have marginally raised bids for Indian pellets to USD 121-122/MT against last assessment at USD 117-119/MT; CFR China for Fe 63% grade pellet (0.5+/-) with 3% Al content.

COAL

Seaborne premium hard coking coal prices have inched up this week, as the Chinese steelmakers were heard to exhibit stronger buying intent amid urgent restocking needs; while the 64 mid-vol prices remained mostly stable over the past two weeks.

However, despite signs of strong buying interest observed in the Chinese market, certain sellers still appeared to hold back and wait, while end-users and traders were actively seeking spot tonnages.

-- Latest offers for the Premium HCC grade are assessed at USD USD 221.65/MT & for the 64 Mid Vol HCC grade at around USD 195.95/MT respectively on CNF India basis.

SCRAP

Imported scrap trades in containers remain low for Indian market - Buying interest for imported scrap remained low on account of easy availability of other alternatives like sponge iron and local scrap amid bearish sentiments in the domestic finished steel market and ongoing elections. Prices dropped further towards the closing of the week following lowering global offers.

Assessment for containerized Shredded from Europe, UK and US dropped majorly at USD 325-332/MT, CFR Nhava Sheva with limited trades reported in the range of USD 325-327/MT, CFR. Offers for South African HMS 1&2 and Dubai HMS 1 stand at USD 330/MT and USD 327-330/MT, CFR respectively. Assessment of West African HMS 1&2 in 20-21 MT containers stands at USD 305-310/MT, CFR Nhava Sheva.

SEMI FINISHED

Following weak demand in finished products amid average supply, the prices of Semis products - Sponge iron declined by INR 200-600/MT, Billet by INR 300-800/MT & Pig iron by INR 100-300/MT, W-o-W.

Participants believed that, prices less likely to further fall and are expected to find support on account of tight raw materials and with hope of better demand in finished products post end of elections in the country.

-- Sponge iron export offers further fell this week by USD 5-10/MT and evaluated at USD 300-305/MT CPT Benapole, equivalent to USD 320/MT CNF Chittagong, Bangladesh.

-- Mid sized mills export offers to Nepal moved down this week by USD 5-10/MT & stood at around USD 445/MT ex-mill, Durgapur for 100*100 mm.

-- Jindal Steel has keep offers unaltered for Panther shots (granulated pig iron) at INR 26,700-27,000/MT ex-plant, Angul, Odisha.

-- SAIL's has conducted a auction for 12,600 MT steel grade pig iron on 8th May'19. In this auction, the response was quite dull as almost entire material unsold at the base price of INR 27,500/MT ex-plant, Rourkela.

-- RINL (Vizag Steel) - state-owned steel maker under the Ministry of Steel, has invited a tender for export of 30,000 MT Billets and 30,000 MT Bloom. The bid due date for the tender is 13th May ‘19 & delivery scheduled by 15 Jun’19.

FINISH LONG

Indian Finish long steel market remains dull amid below to average demand which is being notified through market participants and this resulted fall in prices by INR 500-1,000/MT across regions.

As per medium scale mills, associate - traders have sufficient stock level in major regions and assuming material movement to balance and price range should sustain in coming days with minor changes.

-- Current trade reference rebar prices (12-25 mm) assessed at INR 35,100-35,300/MT Ex-Raipur & INR 36,500-36,700/MT Ex-Jalna; basic & excluding GST.

Further the large mills prices are expected to slightly drop prices in across regions due to lack of inadequate response. Meanwhile current Rebar (12 mm) trade reference price registered at around INR 40,000-40,700/MT ex-Mumbai (Stock Yard).

-- Large Mills offering Structure at around INR 43,000/MT (Channel 125) ex-Chennai, as per booking quantity.

-- Central region based heavy structure manufacturers offering same trade discount at around INR 500-600/MT against last week and current trade reference prices at INR 39,100-39,400/MT (200 Angle) ex-work.

-- Trade discounts in Raipur Wire rod slightly increased and currently maintained at INR 1,100-1,300/MT which has been improved against last week i.e. INR 1,000/MT. Meanwhile basic prices stood at INR 37,700/MT ex-Raipur & INR 36,800-37,400/MT ex-Durgapur.

FINISH FLAT

Sluggish buying and dull trades have resulted to Indian HRC market sentiments subdued in trade market. Ongoing elections, rising inventory among traders due to poor sales volumes have kept Flat steel prices steady in domestic market.

Currently HRC (2.5-8mm,IS2062) in traders market is around INR 41,500/MT ex-Mumbai, INR 41,500-41,700/MT ex-Delhi & INR 44,000/MT ex-Chennai. Meanwhile, CRC (0.9mm,IS 513) in traders market is around INR 46,500/MT ex-Mumbai, INR 45,000-47,000/MT ex-Delhi & INR 50,000/MT ex-Chennai. The prices mentioned above are basic and GST @ 18% will be applicable.

There are expectations in the market that mills will announce discounts for this month shortly over the official offers announced to escalate buying interest. However further information on the same is still awaited.

Furthermore HRC sales volumes suffer in domestic market as imported material is being offered at lower price from Korea, Japan and Iran. Thus major Indian mills have to provide price support by offering discounts to escalate buying in domestic market.