Domestic ferrous scrap prices in India Tuesday rose on tightened supplies despite limited demand in most regions. The bi-weekly Davis Index for HMS 1 &2 (80:20) settled at Rs22,000/mt ($291.78/mt) del Ludhiana mill, up by Rs500/mt ($6.63/mt) from Thursday. The index for sponge iron rose by Rs750/mt to Rs19,500/mt del mill.
Mills cite a severe shortage of sponge iron in the market. Prices of sponge iron were also supported by the ongoing monsoons, a seasonal trend. Most mills continued to buy on need basis despite their depleting inventories.
In Central India, the bi-weekly index for HMS 1 &2 (80:20) rose by Rs250/mt to Rs21,500/mt del Indore mill and the index for sponge iron settled at Rs19,400/mt del Indore mill, up by Rs200/mt. Besides a short supply of scrap, rise in billet trades also gave scrap prices a lift.
Among other markets, the daily index for HMS 1&2 (80:20) settled at Rs20,400/mt del Mandi Gobindgarh mill, up by Rs300/mt and the index for sponge iron rose by Rs200/mt to Rs19,600/mt del mill.
Sponge iron and ferrous scrap prices also increased in eastern India. In Durgapur, the bi-weekly index for sponge iron settled at Rs16,600/mt del Durgapur mill, up by Rs1,100/mt and the index for HMS 1&2 (80:20) settled at Rs23,000/mt del mill, up by Rs 125/mt.
In Mumbai, however, the daily indexes for both, sponge iron and HMS 1&2 (80:20) settled flat at Rs16,200/mt and Rs20,600/mt del mill, respectively. Pune, an auto manufacturing hub close to Mumbai, is under ‘essential services only’ lockdown mode for the second time, weakening market sentiment in the region.
Generation of domestic scrap remains hit as manufacturing activities are yet to return to the usual levels. Additionally, ship demolition at Alang yards remains slow as recyclers are short-staffed.
($1=Rs75.40)