Indian Scrap Market Recovers, Supported By Slight Increase In Steel Prices

The Indian Scrap market has seen a recovery in prices due to a surge in Steel prices. This has led to an increase in the procurement of raw materials by smelters. In addition, the prices of imported Scrap have remained more or less stable week-on-week. In this article, we will discuss the regional price movements, the current prices of HMS (80:20) grade, the impact of price recovery on mid-sized mills, import offers, and future prospects of the Indian Scrap market.

Price Movements

The prices of melting Steel Scrap have risen in the northern region of Punjab by around Rs 1,000/ton, week-on-week. In other parts of the country, prices have increased by Rs 100-500/ton, except in Gujarat. This surge in prices has led to the prices of HMS (80:20) grade to stand at around Rs 41,500-42,000/ton in Mandi Gobindgarh, Rs 39,500-40,000/ton in Raipur, Rs 40,500-41,000/ton in Durgapur, Rs 39,500/t in Alang, and Rs 39,000-39,500/ton in Jalna, and Rs 36,500-37,000/ton in Chennai.

Mid-Sized Mills Impact

The recovery in Steel prices and active Scrap buying by induction furnace mills in the region have influenced Scrap suppliers to raise their prices. Billets prices in the Indian domestic market have surged by Rs 500-1,000/ton in the last 4-5 days. This indicates that the recovery in Steel prices has led to an increase in the demand for raw materials, thereby driving up the prices of Scrap, as per sources report to Ofbusiness.

Import Offers

The import offers for Scrap have slightly increased by $5/ton in a week. The latest offers for shredded grade stand at around $460-465/ton CFR India. The stable import prices have not had a significant impact on the Indian Scrap market. However, any change in the import prices can impact the domestic Scrap prices in India.

Future Prospects

Sources suggest that there may be volatility in Scrap prices as on significant price rallies, Steel demand generally slows down. Moreover, there is less scope for significant price improvement in the international Scrap market. Therefore, domestic Scrap prices in India are likely to change as per demand in the spot market.

OFB’s Insights

The recovery in Steel prices has had a positive impact on the Indian Scrap market, leading to an increase in the procurement of raw materials by smelters. The surge in prices in the northern region of Punjab has led to an increase in the prices of HMS (80:20) grade. The impact on mid-sized mills Steel has been significant, with billets prices in the Indian domestic market rising by Rs 500-1,000/ton in the last 4-5 days. While the import offers for Scrap have remained stable, any change in import prices can impact the domestic Scrap prices in India. The future prospects of the Indian Scrap market are likely to depend on the demand in the spot market.

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