Domestic ferrous scrap prices in most Indian markets were flat to up on Thursday amid supply tightness. In Mandi Gobindgarh, however, prices registered a marginal fall due to a decline in ingot prices. Mills bought scrap only on a need basis. Large-scale mills continued to focus on exports as demand from steel end-users in India is weak because of COVID-19-related lockdowns in major states.
The bi-weekly Davis Index for busheling and End cutting settled unchanged from Tuesday at Rs39,000/mt ($528.7/mt) and Rs38,700/mt del Ludhiana mill, respectively. The index for sponge iron was up by Rs500/mt to Rs32,700/mt del mill.
In Raipur, the bi-weekly index for End cutting rose by Rs500/mt to Rs38,500/mt del mill; while the index for sponge iron was up by Rs750/mt to Rs29,000/mt del mill.
The bi-weekly index for HMS 1&2 (80:20) rose by Rs1,000/mt to Rs32,000/mt del Goa also supported by strong demand along with supply tightness. The index for sponge iron rose by Rs300/mt to Rs30,400/mt del Goa mills.
Although there a lag in demand, market sentiment is positive after primary mills hiked HRC prices in India by Rs3,500-4,500/mt, depending on the location. Strong cues in the global steel markets prompted these steelmakers to raise prices.
In Mandi Gobindgarh, the daily Davis Index for HMS 1&2 (80:20) declined by Rs350/mt to Rs37,050/mt del mill and the index for sponge iron fell by Rs300/mt to Rs32,000/mt del mill. Ingot prices declined by Rs600/mt in a day and weighed down bids for ferrous scrap.
The daily Davis Index for HMS 1&2 (80:20) settled flat on Thursday at Rs35,000/mt del Mumbai mill for the second day; while the index for Sponge iron rose by Rs200/mt to Rs30,100 del mill. Mills opted for sponge iron for their melt requirements as its availability was better compared to ferrous scrap.
Mills in South India were active in the domestic ferrous scrap market as they concentrated on completing their production targets. Offers for imported #1 HMS were firm in the range of $470-$475/mt cfr Chennai, making domestic material a lower-priced alternative.
The resulting rise in demand pushed the bi-weekly index for HMS 1&2 (80:20) up by Rs300/mt to Rs34,600/mt del Chennai mill. The index for Sponge iron rose by Rs150/mt to Rs29,900/mt del mill.