Indian domestic ferrous scrap prices declined for the second consecutive week as trading thinned amid weak demand for finished steel.
The bi-weekly index for HMS 1&2 (80:20) declined by Rs200/mt($2.80/mt) to Rs23,200/mt del Jaipur. Limited trades were reported. Traders believe ferrous prices could decline further if demand remains weak. The index for sponge iron fell by Rs800/mt to Rs21,700/mt del Jaipur.
In the North, the daily Davis Index for HMS 1&2 (80:20) declined by Rs300/mt to Rs21,850/mt del Mandi Gobindgarh and the index for HMS 1&2 (80:20) declined by Rs425/mt to Rs21,850/mt del Ludhiana.
The daily Davis Index for HMS 1&2 (80:20) fell by Rs150/mt to Rs22,550/mt del Mumbai mills and the daily index for sponge iron was unchanged at Rs20,250/mt.
In southern India, the index for HMS 1&2 (80:20) declined by Rs125/mt to Rs23,100/mt del Chennai and the index for sponge iron fell by Rs100/mt to Rs19,900/mt del Chennai.
On the back of the Coronavirus outbreak, China, a major finished steel supplier was at a standstill since January. Indian traders filled in this void by increasing exports. This week, global demand for Indian finished steel reduced, as Chinese markets outside the Hubei province, the epicentre of the virus outbreak, resumed operations.
Traders are expecting prices to fall further in the following week. Market participants await for Indian government to roll out funds which will push infrastructure sector, boosting demand for ferrous scrap.
($1=Rs71.28)