Domestic ferrous scrap markets in India were not in tandem with each other on Thursday. Price movements were mixed, mainly driven by local market fundamentals.
The bi-weekly Davis Index for HMS 1&2 in Indore slid by Rs650/mt ($8.66/mt) to 21,250/mt ($283.28/mt) del mill from Tuesday and the index for sponge iron settled at Rs19,200/mt del mill, down Rs50/mt. Plans for new construction projects in Indore remain stalled amid the ongoing rainy season. Most traders and end-users bought finished steel only to complete their ongoing projects, shared a trader. Thus, despite a shortage of ferrous scrap, a relatively weak demand pressured price.
A shortage of scrap also persists in Ludhiana, North India. The bi-weekly index for HMS 1&2 (80:20) still settled unchanged from Tuesday at Rs21,500/mt del Ludhiana mill and the index for sponge iron fell by Rs50/mt to Rs19,200/mt del mill. The bi-weekly index for end cuttings, however, rose by Rs350/mt to Rs24,800/mt del mill. Steelmakers expect demand to recover gradually in the area. Production levels too are slowly rising but lack of labor is affecting ramping up process. In Mandi Gobindgarh, the daily index for HMS 1&2 (80:20) settled at Rs19,900/mt del mill, up by Rs200/mt and the index for sponge iron rose by Rs100/mt to Rs18,800/mt del mill.
Maharashtra’s capital city Mumbai has the maximum tally of COVID-19 cases in the countries. Limited trades for HMS 1&2 (80:20) were reported in the market with the daily index for the scrap grade rising by Rs100/mt to Rs20,200/mt del mill and the index sponge iron settled unchanged at Rs16,000/mt del mill. With scheduled maintenance activities during the ongoing monsoons, mills are likely to buy actively only after the next two-three months.
In South India, Chennai buyers continued to be active in the ferrous scrap market this week. The bi-weekly index for HMS 1&2 (80:20) rose by Rs800/mt from Tuesday to Rs22,000/mt del mill and the index for sponge iron rose by Rs50/mt to Rs16,200/mt del mill. Though the Tamil Nadu state government’s lockdown is set to continue till July 31, a few relaxations in restrictions jump-started some activities this week, which also includes the Chennai market reopening.