Demand for domestic scrap in India remains subdued with prices in most markets under pressure as they struggled to get economic activities on track after the COVID-19 lockdowns.
The bi-weekly Davis Index for HMS 1&2 (80:20) fell by Rs800/mt ($10.68/mt) from Tuesday to Rs19,700/mt ($263.10/mt) delivered Jalna mill. Scrap prices were weighed down by a drop in finished steel prices, mainly rebar by Rs500/mt from Wednesday. The index for sponge iron inched up by Rs50/mt to Rs18,000/mt del mill.
India’s rural sector is expected to absorb the COVID-19 impact better compared to the urban sector with the government aiding the agricultural sector. Downstream steel industries, including the construction sectors, are thus likely to fare better in these areas. However, the number of new COVID-19 in Jalna are on a rise which could mean stringent movement restrictions for the area in the coming days.
In Durgapur, the bi-weekly index for HMS 1&2 (80:20) rose by Rs350/mt to Rs22750/mt del mill but the index for sponge iron fell by Rs400/mt to Rs15,000/mt delivered mills. Few trades for scrap were reported amid moderate demand.
The bi-weekly indexes for HMS 1&2 (80:20) settled at Rs20,550/mt del Jaipur mill, down by Rs150/mt and Rs21,000/mt del Indore mill, up by Rs150/mt. Suppliers in both regions struggled to collect scrap. In Indore, demand for scrap remains moderate while in Jaipur buyers stayed away from trades. The indexes for sponge iron in Jaipur and Indore settled at Rs18,100/mt delivered mill, unchanged and Rs19,000/mt delivered mill, up by Rs300/mt, respectively.
In Mumbai, the government has levied stringent movement restrictions from Wednesday to combat a steep surge in COVID-19 cases. The daily index for HMS 1&2 (80:20) fell by Rs100/mt to Rs20,300/mt delivered mill and the index for sponge iron settled unchanged at Rs16,000/mt del mill as trades remain hit. Similarly, in South India, the Chennai market remains shut with the lockdown continuing till July 6 at the minimum and the bi-weekly indexes for HMS 1&2 (80:20) and sponge iron settling unchanged at Rs21,000/mt and Rs16,300/mt delivered mill, respectively.
The daily Davis Index for HMS 1&2 (80:20) in Mandi Gobindgarh settled at Rs19,900/mt delivered mill, down by Rs400/mt, weighed down by a fall ingot prices by Rs200/mt. The index for sponge iron settled at Rs17,250/mt delivered mill, up by Rs50/mt. Production is Mandi is likely to fall in the coming days with mills and markets adopting a five-day week till July 26 at the minimum.