Indian ferrous scrap prices shot up again on Tuesday amid bullish market sentiment. Over the weekend, state-owned steel player RINL announced a fifth hike for finished steel prices in December. The mill has raised rebar prices by Rs8,000-9,000/mt ($108-122/mt) depending on the sizes since early December.
In the North, the daily Davis Index for HMS 1&2 (80:20) rose by Rs500/mt ($6.81/mt) to Rs29,600/mt ($403.35/mt) del Mandi Gobindgarh mill aided by rising imported scrap offers. The index for Sponge iron, however, settled flat at Rs29,400/mt del mill with no trades reported at the index price.
In Ludhiana, the bi-weekly index for HMS 1&2 (80:20) rose by Rs1,500/mt from Thursday to Rs31,000/mt del mill and the index for Sponge iron settled unchanged at Rs29,500/mt del mill.
Steel prices have increased by 55pc in the past six months, driving the union minister for MSMEs to write to the Prime Minister’s office to regulate prices. Considering the pace of rise, many market participants are worried of a crash like in 2008. They are thus exercising caution while resorting to trades.
In Indore, the bi-weekly index for HMS 1&2 (80:20) rose by Rs800/mt from Thursday to Rs30,300/mt del mill while the index for Sponge iron rose by Rs400/mt to Rs28,000/mt del mill.
In South India, the bi-weekly index for HMS 1&2 (80:20) rose by Rs1,000/mt to Rs32,000/mt del Chennai mill due to tight supply. Demand for finished steel remained sluggish. Limited trades were reported at the index price. The index for Sponge iron settled flat at Rs28,500/mt del mill.
In Mumbai, the Davis Index for HMS 1&2 (80:20) declined by Rs100/mt Rs29,900/mt del mill, but market participants believe the prices could increase by Rs3,000/mt in the next few weeks amid persistent domestic shortage along with rising imported scrap offers. The index for Sponge iron, however, settled flat at Rs28,250/mt with no deals reported.
In other regions, the bi-weekly index for HMS 1&2 (80:20) rose by Rs1,500/mt to Rs32,000/mt del Durgapur mill despite slow demand for finished steel. The index for Sponge settled flat at Rs26,500/mt del mill.