Indian Steel Market Weekly Snapshot

According to Mining News Pro -Indian domestic steel prices declined during the week - 43 (22-27 Oct) of 2018. The prices fall in line with poor domestic & export demand.

As per assessment the prices of Semis & Finished long steel fall by INR 200-1,000/MT (USD 3-14). Similarly the Flat steel prices down by INR 500-1,000/MT (USD 7-14) in traders market.

The producers based in eastern India who largely export Billet & Wire rod to Nepal stated mute demand due to festive mood in the country. Similarly in rest parts of India, where local demand was not up the mark, hence prices fall significantly.

However the market participants believe, the current prices are bottomed out and are likely to find support in coming days.

Also ahead Diwali festival the stockists are quite active to re-stock the material with an assumptions of active demand post the festive off from the construction sector and end user segments. Thus, this may lent support to domestic steel prices.

Iron ore & Pellets: According to trade sources, Odisha based merchant iron ore miners have further increased discounts of INR 100-200/MT in addition to the previous discounts so as to escalate buying interest. SteelMint learned from the sources that currently trade prices for Fe 63% fines are around INR 3,000/MT and for 5-18 mm (Fe 63%) around INR 5,700/MT (ex-mines, including Royalty, DMF & NMET).

-- NMDC has concluded an auction on 23rd Oct’18 for 112,000 MT iron ore from its Chhattisgarh mines. According to market participants, DR-CLO fetched flat bids and bids placed was at the base price of INR 4,655/MT (basic). It has kept iron ore prices unchanged from Chhattisgarh mines.

-- Domestic pellet trades showed a mixed response after festivity with buying interest at the lower side. Central India (Raipur) pellet offers are mostly stable & stood at around INR 8,200-8,300/MT (basic, Raipur), however buying interest is lower by INR 300-400/MT than current offers. Durgapur pellet price has also not seen any movement and it remains firm at INR 8,000-8,100/MT (delivered) in line with the last week’s assessment.

-- Jindal Steel concludes 50,000 MT pellet export deal at around USD 139-140/MT CFR China, which is equivalent to USD 127-128/MT FoB India and INR 8100-8200/MT ex-plant.

-- KIOCL has recently concluded a deal of 50,000 MT pellets of Fe 65/64% grade (less than 2% alumina) at around USD 139-140/MT, FoB India- Sources.

-- BRPL has recently concluded two pellet deals to China of around 60,000- 62,000 MT each. The deal concluded was for regular grade pellets with Fe 64% and 3% Alumina for end October shipment at around USD 137/MT, CFR China. However Fe 65% pellet export prices get a bonus and is assessed at around USD 139/MT, CFR.

Indian Imported Scrap market observed few trades for HMS scrap at corrected prices by USD 5-7/MT W-o-W. Dubai origin containerized HMS sold at around USD 330-335/MT, CFR Nhava Sheva and West African HMS 1&2 traded at around USD 320-325/MT, CFR. Yards from UK and USA hold offers for Shredded stable in the range USD 355-360/MT, CFR but no major deal heard for Shredded on less viability. Importers remain less active on depreciated INR and finish steel demand hasn’t recovered yet as expected.

Australian premium hard coking coal prices have been softening after having peaked in the middle of last week as market activity slowed down towards the end of the week.

However, hard coking coal prices have picked up this week due to the overall supply tightness in the second-tier market. Following the occurrence of an accident at a coal mine in China’s Shandong province, local authorities have halted production at 41 coal mines.

CNF China prices are expected to be supported in the near term as there could be restocking demand by Chinese end-users as winter approaches. Also, there had been no deals done for a while.

Latest spot prices for the Premium HCC and 64 Mid Vol HCC grade are assessed at around USD 219.50/MT and USD 193.60/MT FOB Australia respectively. For Indian buyers, the above offers amount to USD 234.50/MT and USD 208.60/MT respectively on CNF India basis.

Semi finished Steel: On weekly basis, sponge prices fall by INR 200-400/MT owing to limited booking by domestic EA & Induction furnaces. Meanwhile billet offers declined by INR 200-800/MT following poor off take in finished products.

-- Indian induction grade billet export offers to Nepal hovering at USD 470/MT ex-mill at Durgapur, equivalent to USD 495/MT CNF Raxaul/Jogbani border. As per exporters buying interest from Nepal based mills remain weak due to seasonal slowdown in the country and with anticipation of further fall in Indian domestic & export prices.

-- Indian Sponge iron export offers to Bangladesh for FeM 78-80 is hovering at USD 340/MT CPT Benapole (dry land port of Bangladesh & India) and USD 360/MT, CFR Chittagong.

-- BHEL had invited a global tender for purchase of 13,500 MT carbon steel/alloy steel round rolled bloom for manufacturing of hot and cold finished seamless steel tubes/pipes as per Indian Boiler Regulations (IBR) at Tiruchirappalli, Tamil Nadu. And the due date for bid submission is 08 Nov’18

-- RINL has invited tender for export of 10,836 MT Billets to Nepal. Interested bidders can submit their bids till 30 Oct’18. And the last ocean export tender of 10,000 MT Billets and 20,000 MT Blooms whose due date was on 24 Oct’18 has extended till 30 Oct’18.

-- Tata Metaliks Limited (TML) posted a gain of 21.5% in net profit (PAT) in H1 FY19 to INR 77.92 crore on rise in production and higher price realizations, as per press released on 23rd October.

-- Neelachal Ispat Nigam Ltd (NINL), India’s largest and state owned steel grade pig iron manufacturer & exporter has reduced pig iron prices by INR 1,300/MT (USD 18). The latest offers for Steel (N1) grade material are assessed at INR 28,500-28,900/MT (USD 390-395), ex-Cuttack, Odisha.

-- Jindal Steel is offering Steel grade Pig iron at INR 29,800/MT ex-plant, Raigarh & Granulated Pig iron (panther shots) at INR 28,000/MT ex-plant, Odisha

-- SteelMint`s Pig iron export price assessment stood at USD 375-385/MT FoB India, USD 350-360/MT FoB Brazil and USD 360-370/MT FoB Black sea.

Indian Finish Long Steel market remained quiet amid bearish sentiments due to festive season and limited buying inquiries were hovering in overall regions over uncertain direction. Limited dispatches in specified regions affected price range by around INR 1,000/MT (TMT & Structure).

-- The rebar (12-25 mm) price assessed at INR 37,100-37,500/MT Ex- Jalna, INR 36,700-37,000/MT Ex- Raipur. All prices are basic & excluding GST.

Further central region based heavy structure manufacturers are trying to calm the discount level to evolve conversion spread but minor improvement observed and current range noticed by around INR 800/MT which were balanced around 1,000-1,100/MT, as per sources. Current trade reference prices of medium mills stood at INR 42,200-42,600/MT (200 Angle).

-- Wire rod trade discount offered by manufacturers/suppliers in Raipur increased as compare to last week which is now in the range of INR 1,000-1,200/MT.

Further the large mills rebar prices were observed under pressure in traders market amid falling prices in secondary market. Hence, the prices have softened by INR 300-500/MT W-o-W. However, the large steel mills still hold the prices and no announcement heard in the ongoing week.

The current trade reference prices for 12mm rebar by large mills hovering at INR 43,800-44,300/MT (ex-Mumbai), INR 44,500-45,000/MT (ex-Delhi). The prices mentioned above are basic prices excluding GST 18%.

-- SAIL - Universal Rail Mill in (BSP) recorded a new high in daily production with rolling of 245 numbers of 130 metre long rails on 21st October 2018, surpassing previous best of 229 nos of 130 metre rails rolled on 6th Sept`18, as per company`s website.

Finish Flat Steel: Domestic HRC prices in India have remained under pressure over combination of factors like falling trades in domestic market, limited export bookings over lowered prices and parity in imports. This week market remained soft over bearish market sentiments and sluggish demand prevailing in domestic market.

In traders market, HRC prices have weakened by INR 500-1,000/MT W-o-W. Current trade reference prices for HRC (IS2062) 2.5 mm-8 mm is around INR 46,500/MT (ex-Mumbai) & INR 47,000/MT (ex-Delhi). The prices for CRC (IS513) 0.9mm is hovering in the range of INR 52,500/MT (ex-Mumbai) & INR 53,000 - 54,500/MT (ex-Delhi).The prices mentioned above are basic prices excluding GST@18% on cash payment basis.

Thus market sources shared that major Indian steel mills may provide discounts and rebates in upcoming month by around INR 1,000-1,500/MT to escalate buying interest.

Limited HRC export deals concluded by Indian mills- Market sources shared with SteelMint that a major Indian mill has concluded an export deal of around 10,000-20,000 MT HRC to Vietnam at USD 562-565/MT CFR basis for November shipments.

Indian Raw material and Finished Steel reference Prices as on 27 October 2018 (Week 43)

Prices are Ex-works, Exclusive of GST at 18%

Indian Export Reference Prices as on 27th October`18