Domestic sponge iron prices fell in North as sponge makers offered discounts to steel mills to clear their inventories and increase cash flow. The daily Davis Index for sponge iron declined by Rs1,300/mt ($17.21/mt) to Rs17,250/mt del Mandi Gobindgarh.
The daily index for HMS 1&2 (80:20) rose by Rs600/mt to Rs20,800/mt del Mandi Gobindgarh as scrap supply was scarce in the domestic market.
Amid hastened deals to sell material and gain liquidity, transportation still remains a challenge in most regions as trucks and truck drivers stayed offroad. Traders expect domestic scrap price to remain high as scrap collection is yet to resume in most part of India despite easing of lockdown restrictions.
In the Southern region, the biweekly index for HMS 1&2 (80:20) settled unchanged to Rs19,850/mt del Chennai mills as trades thinned. The index for sponge iron remained flat at Rs17,150/mt del Chennai mills
Mumbai markets are closed as the city has become a COVID-19 hotspot. The daily Davis Index for HMS 1&2 (80:20) and sponge iron settled unchanged at Rs21,670/mt and Rs17,800/mt del Mumbai mills, respectively.
Steel production resumed in Goa boosting the price of domestic scrap as the supply of imported scrap is stopped due to transportation issue. The index for HMS 1&2 (80:20) increased by Rs625/mt to Rs20450/mt del Goa mills and the index for sponge iron rose by Rs675/mt to Rs17,450/mt.
West Bengal scrap markets were shut as the cyclone Amphan hit the region and caused flooding and damage to infrastructure. The index for HMS 1&2 (80:20) and sponge iron settled flat at Rs19,400/mt and 16,700/mt del Durgapur mills, respectively.
The bi-weekly index for HMS 1&2 (80:20) increased by Rs250/mt to Rs22,250/mt del Raipur as demand for finished steel rose on Thursday. The index for sponge iron increased by Rs200/mt to Rs1,530/mt del Raipur.
In Indore, mills continued to liquidate their piled up steel inventory. Once they ramp-up production, mills are likely to be in the market for domestic scrap over imported, as Indian currency has depreciated to Rs75.52 on Thursday against US$1 from Rs72.17 level in February end. The higher delivery time for imported scrap is also likely favour domestic scrap trades. The index for HMS 1&2 (80:20) rose by Rs450/mt to Rs21,900/mt del Indore and the index for sponge iron increased by Rs450/mt to Rs17,400/mt del Indore mills.
($1= Rs75.52)