Indian domestic ferrous scrap prices were flat on Monday in silent markets. At a few places, including Punjab, state governments have imposed curfews restricting movement till March 31 to contain the spread of COVID-19.
The Davis Index for HMS 1&2 (80:20) settled unchanged at Rs20,150/mt ($264.8/mt) del Mandi Gobindgarh from Friday. Induction furnaces in Mandi and Ludhiana have been shut temporarily, which will impact steel output in the coming days. Despite this halt in production, mills will continue to pay Rs500,000-1,000,000 per day. Subsequently, the cost of restarting the idled furnaces will also have to be borne by these mills. The daily index for sponge iron settled flat at Rs20,000/mt del Mandi Gobindgarh. At present, thinned trading has led to a reduction in liquidity across markets, state manufacturers. Real estate and construction projects have come to a standstill due to lockdown across the country. In Mumbai and Jalna, mills will remain shut till March 31 due to the government-imposed restrictions to contain the rise in cases of COVID-19.
In Mumbai, the daily index for HMS 1&2 (80:20) was flat at Rs22,450/mt del mills and the index for sponge iron settled Rs17,900/mt del mills, also unchanged.
The Indian rupee continued to depreciate further and was at Rs76.1 against US$1 on March 23, from Rs75.16 on March 19. Traders have, thus, refrained from booking imported scrap for the past few days. With no orders in the pipeline, traders expect the supply of ferrous scrap to tighten and its prices to increase after the markets reopen. Additionally, mills could opt for sponge iron, pushing its prices up.
($1=Rs76.1)