India: BigMint's scrap index rises INR 200/t ($2.4/t) despite moderate demand
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BigMint's domestic steel scrap index (end-cutting) in Mandi Gobindgarh recorded a rise of INR 200/t, settling at INR 37,400/t on a delivered-at-plant (DAP) basis on 28 March, 2024. Moderate trading activity has been observed in the market over the past few days.
In Mandi, there was an upward movement in steel ingot prices today, with a rise of INR 200/t, reaching INR 42,900/t during the reporting and normalisation process. Similarly, other major markets also experienced an increase in steel ingot prices, ranging from INR 100 to INR 200/t. Rebar (Fe500) prices went up by INR 300/t to INR 47,400/t d-o-d.
Present market condition
The Mandi steel market has been facing a shortage of scrap impacting operations. Despite moderate levels of finished steel sales, the scarcity of scrap has prompted suppliers to raise prices. As a result, smaller mills are procuring scrap only based on immediate needs, operating for shorter durations of 10-12 hours. Conversely, larger mills with ample scrap inventory continue to operate round the clock. However, if the current scrap shortage persists, even these larger mills may need to reduce operating hours to 15-16 hours.
The arrival of scrap from neighbouring states has been notably slow in Mandi, possibly due to stringent checking procedures in certain states.
Imported scrap market
Indian buyers have adopted a cautious wait-and-see approach, largely due to the unviability of imported scrap compared to domestic market prices. Additionally, market activities have been sluggish, partly due to a week-long holiday during the Holi festival, with some buyers still in holiday mode.
Shredded scrap offers from the US and Europe are at $408-$415/t CFR, while HMS (80:20) prices ranged from $375-$388/t CFR.
Notably, a bulk vessel carrying approximately 25,000 t of mixed shredded and HMS scrap is anticipated to arrive at an India port by the end of March.
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