Markets in Mumbai continued to remain flat on Friday amid sluggish demand from mills and shortage of ferrous scrap. Mill preferred to buy on a need basis as strict lockdown measures in Maharashtra impacted sales of finished steel.
The daily Davis Index for HMS 1&2 (80:20) settled flat at Rs31,000/mt ($413/mt) del Mumbai mills and the index for Sponge iron remained unchanged on Friday at Rs29,700/mt del mills.
In Mandi Gobindgarh, the Davis Index for HMS 1&2 (80:20) rose by Rs750/mt ($9.99/mt) to Rs35,550/mt ($464.39/mt) del mill on Friday amid tight supply. Strict lockdown measures in Punjab kept the mills away from the market. Low availability of oxygen cylinders affected production.
The index for Sponge iron rose by Rs575/mt Rs32,700/mt del mill on Thursday fuelled by rising iron ore prices.
Market participants feel there is still room for finished steelmakers to increase prices to bring it at par with global rates. Freight rates have also increased by around $10/mt, which has impacted international trades. Mills will soon run out of inventories and will have to book scrap to finish their daily production target.