Domestic ferrous scrap prices in most parts of India were bullish. Although a few regions are lagging in demand, scarcity of material gave prices a lift.
In North, finished steel demand recovery is gradual but raw material prices have been on an uptrend, largely driven by transportation issues. Rail transport in the region has been hampered due to blockade by farmers protesting against government’s proposed Farm Bill. In Ludhiana, the bi-weekly index for HMS 1&2 (80:20) increased by Rs300/mt ($4.06/mt) to Rs25,000/mt ($339.06/mt) del mill, while the index for Sponge iron settled at Rs24,750/mt delivered mill, up by Rs1,100/mt. The index for HMS 1&2 (80:20) settled at Rs23,500/mt del Mandi Gobindgarh mill, up by Rs300/mt, and the index for Sponge iron settled at Rs23,300/mt delivered mill, up by Rs400/mt. A shortage of iron ore in the Indian markets has raised input costs for Sponge iron. Producers thus increased their asking prices to pass on a partial rise to buyers.
In Indore, the bi-weekly index for HMS 1&2 (80:20) rose by Rs150/mt to Rs25,500/mt delivered mill, and the index for sponge iron increased by Rs300/mt to Rs23,500/mt del mill. Positive sentiment in the steel market aided by the recovering construction sector has kept prices firm.
The bi-weekly Davis Index for HMS 1&2 (80:20) rose by Rs1,500/mt from the prior Thursday to Rs25,000/mt del Hyderabad mill, while the index for sponge iron increased by Rs500/mt to Rs21,300/mt del mill. A shortage of ferrous scrap amid mills ramping up operations have given prices a lift. Till the Diwali festival ends in mid-November, the market is unlikely to register any drastic movement on either side of the spectrum, believe most steelmakers.
Imported ferrous scrap offers in the Indian market continued to rise with a bearing on domestic scrap offers. The index for HMS 1&2 (80:20) rose by Rs400/mt to Rs24,600/mt del Mumbai mill, and the index for Sponge iron increased by Rs500/mt to Rs21,500/mt del mill.
The bi-weekly Davis Index for HMS 1&2 (80:20) in Durgapur increased by Rs1,200/mt to Rs26,000/mt del mill and the index for Sponge iron rose by Rs800/mt to Rs21,200/mt del mill. Most mills were unable to find enough material to feed their furnaces and thus were willing to raise bids to secure scrap.