Offers for domestic scrap in Mumbai increased by Rs400-500/mt amid prolonged shortage of raw material and firm demand from the local mills. The alarming rate at which COVID-19 cases are increasing has led to a short of oxygen cylinders for mills,as 70pc of cylinders are being diverted for medical use. This may impact the production activity to a certain extent. The daily Davis Index for HMS 1&2 (80:20) rose by Rs500/mt ($6.65/mt) to Rs32,500/mt ($432.8/mt) del Mumbai mills. Offers for Sponge iron have also increased as mills are preferring Sponge over scrap. The index for Sponge iron rose by Rs600/mt to Rs33,100/mt del Mumbai mills.
In Mandi Gobindgarh, the daily Davis Index for HMS 1&2 (80:20) rose by Rs500/mt to Rs35,050/mt del mill due to supply shortage as well as sluggish demand for finished steel. Mills are facing supply constraints due to strict lockdown measures imposed by several state governments to contain the resurgence of COVID-19. Mills have adopted a wait-and-watch approach amid rising imported scrap prices. They expect prices to fall post-Eid, almost a month away. The demand for Sponge iron in Mandi Gobindgarh has been sluggish, therefore, the manufacturers from Jharkhand and Raipur are reluctant to reduce offers. The offers for Sponge iron have risen by Rs1,000/mt from Friday amid firm demand from Central and Southern regions. The index for Sponge iron increased by Rs900/mt to Rs31,650/mt del Mandi mill with limited deals being reported.