Domestic ferrous scrap prices remained under pressure on Tuesday amid low demand for finished steel. With production affected due to lack of oxygen cylinders for industrial use, mills stayed away from ferrous scrap purchases. Economic activities in the country have dipped amid lockdowns and restrictions on movement in most parts of the country.
The daily Davis Index for HMS 1&2 (80:20) declined by Rs1,500/mt ($19.9/mt) to Rs31,000/mt del Mumbai mills and the index for sponge iron declined by Rs200/mt to Rs30,000/mt del Mumbai mills.
Markets in the northern India witnessed a similar trend with the bi-weekly Davis Index for end cutting and busheling dropping by Rs1,400/mt from last Thursday to Rs36,200/mt and Rs36,500/mt del Ludhiana mill, respectively. The index for HMS 1&2 (80:20) fell by Rs1,000/mt to Rs33,000/mt del mill.
In Mandi Gobindgarh, the daily Davis Index for HMS 1&2 (80:20) declined by Rs1400/mt to Rs34,050/mt del mill amid fall in ingot prices due to the sluggish demand from the end-users and the index for sponge iron declined by Rs600/mt to Rs31,500/mt del mill.
Ferrous scrap prices in the southern India showed an uptick amid shortage and firm demand from the mills. In Chennai, the bi-weekly index for HMS 1&2 (80:20) rose by Rs1,625/mt to Rs34,000/mt del mills.
Offer for ferrous scrap in Durgapur declined as mills preferred to procure raw material on a need basis. Sales of finished steel was also under pressure. The bi-weekly index for HMS 1&2 (80:20) declined by Rs1,000/mt to Rs33,000/mt del Durgapur mills and the index for sponge iron declined by Rs1,500/mt to Rs28,000/mt del Durgapur mill. After a panic-filled last week due to the lockdown, markets in Jalna saw an uptick in prices on Tuesday as mills started procuring ferrous scrap to finish their daily production target. The index for HMS 1&2 (80:20) rose by Rs2,500/mt to Rs32,500/mt del Jalna mill. Market participants expect prices to remain under the pressure in the near-term, and hope that once restrictions are eased, demand will surge and boost prices.