Indian domestic ferrous scrap prices fell on Tuesday as demand in steel mills declined. Finished steel was oversupplied in domestic markets with a relatively lesser demand
The daily Davis Index for HMS 1&2 (80:20) declined by Rs300/mt ($4.20/mt) to Rs22,800/mt del Mumbai mills as buyers refrained from transactions. The daily index for sponge iron fell by Rs150/mt to Rs20,200/mt.
In the North, the index for HMS 1&2 (80:20) declined by Rs625/mt to Rs21,775/mt del Ludhiana and the daily Davis Index for HMS 1&2 (80:20) fell by Rs75/mt to Rs21,875/mt del Mandi Gobindgarh as mills are steel mills held sufficient inventories of raw materials.
Traders across India faced liquidity crunch and stayed away from transactions. The index for HMS 1&2 (80:20) declined by Rs450/mt to Rs22,550/mt del Jalna and the index for sponge iron fell by Rs250/mt to settle at Rs20,375/mt del Jalna, .
In Southern India, the index for HMS 1&2 (80:20) declined by Rs400/mt to Rs22,950/mt del Chennai, buyers refrained from buying ferrous scrap in a hope that prices will fall further. The index for sponge iron settled at Rs19,750/mt fell by Rs250/mt.
The index for end cuttings declined by Rs500/mt to Rs25200/mt del Nagpur and the index for sponge iron fell by Rs575/mt to Rs20,075/mt.
Market participants were expecting the ferrous scrap prices to go northwards after the announcement of budget 2020. The prices, however, declined due to weakened demand for finished steel with no immediate infrastructural projects in the pipeline.
Ferrous scrap prices are likely to decline further as the Union budget 2020 failed to infuse liquidity in domestic markets, according to traders.