Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Demand for finished steel in the month of June 2020 remained subdued as the country still had lockdown restrictions amid increasing COVID-19 cases. Mills remained shut and there was a dearth of raw material.


Prices for HMS 1&2 (80:20) in June dipped by Rs550/mt to Rs20,400/mt del Mumbai mills while in July prices surged by Rs1,950/mt to Rs22,050/mt del mills on a gradual increase in demand from the mills which resumed operations.


Billet prices in Mumbai fell by Rs2,100/mt in June to Rs27,600/mt, but recovered in July by Rs1,700/mt and settled at Rs29,300/mt ending the month at higher levels.




The spread between HMS 1&2(80:20) to billet was Rs8,750/mt in June, but due to increase in raw material prices, it narrowed by Rs1,500/mt to Rs7,250/mt in July.


Sponge iron prices saw a similar trend in Mumbai in June when the index fell by Rs1,900/mt del Mumbai to Rs16,000/mt. It rose by Rs2,850/mt to Rs18,850/mt in July. Mills were keen to book sponge over scrap as availability of scrap was low and prices high.


The spread between sponge iron to billet in Mumbai was Rs11,800/mt in June, but narrowed by Rs1,350/mt to Rs10,450/mt in July.


Billet manufacturers felt the heat of the increased raw material prices in Mumbai, however, as demand from the finished steel makers was low, billet suppliers held their offers.


In the North, HMS prices declined by Rs600/mt to Rs20,450/mt del Mandi Gobindgarh in June, but rose July by Rs450/mt to Rs20,800/mt. Ingot prices saw a similar trend and moved in line with scrap prices. Ingot prices declined by Rs500/mt in June to Rs30,950/mt del Mandi Gobindgarh, but started picking up in July and rose by Rs350/mt to Rs31,300/mt.




The spread between HMS to Ingot in Mandi Gobindgarh was Rs10,400/mt in June which increased by Rs100/mt to Rs10,500 in July, while the spread between sponge iron to ingot rose by Rs150/mt to 11,500/mt in July compared to the previous month.


Demand for finished steel is expected to revive in August due to uptick in various activities because of phased relaxation in lockdown along with increase in exports.

Leave a Reply

Your email address will not be published.