India: Stainless steel scrap prices correct downwards amid volatile LME nickel

Domestic 304 grade stainless steel scrap prices dipped to INR 131,000/t ($1,604/t) ex-Delhi today from INR 134,000/t ($1,640/t) last week, as per SteelMint data.

Meanwhile, LME's 3-months nickel (Ni) prices fell 13% w-o-w to around $25,200/t at the time of publishing the article.

Buyers are quoting lower prices due to LME Ni correction and subdued demand. "Deals for 304 grade Europe-origin scrap are happening at a price range of $1,520/t-$1,550/t, which is $50-70 less than the last week levels," a seller told SteelMint.

Overseas sentiments also reflected in the domestic stainless steel scrap market which resulted in correction in prices.

Finished prices stable w-o-w

Finished prices of 304 grade stainless steel HRCs and CRCs remained stable w-o-w despite LME volatility. The price of 304 grade stainless steel HRC stood at INR 244,000/t ($2,988/t) ex-Mumbai.

"There is no visible impact of export duty removal in the market because Indian export offers are still $100-150/t higher in flats segment than offers by other competing countries. In the long term, we can expect some good news about the industry," an exporter said.

It is important to note that on 18 November, the government of India removed 15% export duty on stainless steel flats/longs products.

Ferro chrome trends

Indian ferro chrome prices fell w-o-w amid muted demand. As per SteelMint's assessment on 17 November, ferro chrome prices for HC60% hovered at INR 99,000-100,000/t exw-Jajpur. Domestic buyers remained silent, opting for a wait-and-see strategy, on anticipation of a drop in prices following Vedanta's ferro chrome auction on 10 November. In addition, Chinese buyers sought material from an Indian seller at a price which was lower than domestic offers. As a result, despite high production costs, producers were forced to lower their offers.

Outlook

Prices of stainless steel scrap can be seen decreasing but finished stainless steel demand remains stable. However, market participants are optimistic about the market improvement from mid-December.