Indian domestic steel prices continued to exhibit down ward sentiments last week. Although the fall in long products can be attributed as mare correction to abnormal surge during December, the fall in flat products reflects weakness in demand.
Long products gained by as much as 28% in December 2009 and so far the loss is Marley 10%. The long product market remains subdued and as a result, prices of input materials have been falling every day. Pencil ingot lost grounds at most of the locations in India last week and its effect on rebar prices was visible, but the situation could get worse as Indian steel majors may have to reduce their prices for longs this month.
On the other hand, flat products, contrary to hike in global levels, have been coming down in India, thus putting a question mark on real overall demand despite support from booming auto sector. Indian steel majors who are already facing difficulties may face further pressure due to lower HR offers from China which were reported last week.
The Indian Long Product Price Index ILPPI last week decreased by 155 points whereas Indian Flat Products Index IFPPI decreased by 49 points. The overall price index INDSPI decreased by 105 points.
| Class | 22-Jan | 29-Jan | Change | % |
| ILPPI | 6872 | 6716 | -155 | -2.3% |
| IFPPI | 7457 | 7409 | -49 | -0.7% |
| INDSPI | 7151 | 7046 | -105 | -1.5% |
ILPPI - Indian Long Product Price Index
IFPPI - Indian Flat Product Price Index
INDSPI - Indian Steel Price Index
Long Products
| Category | 22-Jan | 29-Jan | Change | % |
| PI - TMT | 6652 | 6361 | -291 | -4.4% |
| PI - WRC | 7376 | 7332 | -44 | -0.6% |
| PI - Angle | 6505 | 6320 | -185 | -2.8% |
| PI - Channel | 6528 | 6410 | -118 | -1.8% |
| PI - Joist | 5967 | 5937 | -30 | -0.5% |
PI - Product Index
Flat products
| Category | 22-Jan | 29-Jan | Change | % |
| PI - Narrow Plates | 7150 | 7100 | -49 | -0.7% |
| PI - Wide Plates | 7251 | 7168 | -83 | -1.1% |
| PI - Hot Rolled | 7253 | 7193 | -60 | -0.8% |
| PI - Cold Rolled | 8098 | 8048 | -51 | -0.6% |
| PI - Galvanized | 8009 | 8080 | 71 | 0.9% |
PI - Product Index
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1. Input material
Melting scrap
80:20
HMS
| Location | Change |
| Chennai | -3% |
| Kandla | -5% |
| Kanpur | -2% |
| Kolkata | -5% |
| Mandi | -5% |
| Mumbai | -3% |
Change is on January 29th 2010 as compared to January 22nd 2009
Alang
| Product | Size | Change |
| Plate cuttings | 1" | -2% |
| Ships | Mixed | -4% |
Change is on January 29th 2010 as compared to January 22nd 2009
Pencil ingot
| Location | Change |
| Ahmedabad | -3% |
| Bhiwari | -6% |
| Durgapur | -5% |
| Ghaziabad | -6% |
| Hyderabad | 0% |
| Jaipur | -5% |
| Jamshedpur | -12% |
| Kanpur | -3% |
| Kolkata | -5% |
| Mandi | -4% |
| Mumbai | -4% |
| Muzzafarnagar | -5% |
| Nagpur | -5% |
| Raigarh | -4% |
| Raipur | 0% |
| Rourkela | -7% |
| Rudrapur | -3% |
Change is on January 29th 2010 as compared to January 22nd 2009
Pig Iron
| Location | Change |
| Agra | 1% |
| Jallandhar | 1% |
| Kolkata | 0% |
| Raipur | 0% |
Change is on January 29th 2010 as compared to January 22nd 2009
Sponge iron
| Location | Change |
| Bellary | -8% |
| Kolkata | -3% |
| Raigarh | -4% |
| Raipur | -15% |
| Rourkela | -5% |
Change is on January 29th 2010 as compared to January 22nd 2009
2. Long products
TMT
Fe 415
12mm
| Location | Change |
| Ahmedabad | -7% |
| Chennai | -3% |
| Delhi | -3% |
| Indore | -3% |
| Kanpur | -1% |
| Kolkata | -4% |
| Mandi | -3% |
| Mumbai | -3% |
| Raipur | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
WRC
SWR14
5.5/6
| Location | Change |
| Chennai | 0% |
| Delhi | 0% |
| Kanpur | -2% |
| Kolkata | -3% |
| Raipur | 1% |
Change is on January 29th 2010 as compared to January 22nd 2009
ANGL
Grade A
65X65X6
| Location | Change |
| Ahmedabad | -5% |
| Bangalore | -4% |
| Chennai | -3% |
| Delhi | 0% |
| Indore | -1% |
| Kanpur | -3% |
| Kolkata | -3% |
| Mandi | 0% |
| Mumbai | -3% |
| Raipur | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
CNHL
Grade A
75/40
| Location | Change |
| Ahmedabad | -6% |
| Bangalore | -2% |
| Chennai | -3% |
| Delhi | 3% |
| Indore | -1% |
| Kanpur | -2% |
| Kolkata | 0% |
| Mandi | -3% |
| Mumbai | -3% |
| Raipur | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
JSTI
Grade A
250X125
| Location | Change |
| Ahmedabad | -3% |
| Bangalore | 5% |
| Chennai | -3% |
| Delhi | 3% |
| Indore | 0% |
| Kanpur | -3% |
| Kolkata | 0% |
| Mandi | -3% |
| Mumbai | -3% |
| Raipur | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
3. Flat products
HRC
Tube
2.5x1250
| Location | Change |
| Ahmedabad | 0% |
| Bangalore | 0% |
| Chennai | -2% |
| Delhi | -3% |
| Kolkata | 0% |
| Ludhiana | 1% |
| Mumbai | 0% |
Change is on January 29th 2010 as compared to January 22nd 2009
Patra
| Location | Change |
| Delhi | 0% |
| Ludhiana | 2% |
| Mandi | 1% |
Change is on January 29th 2010 as compared to January 22nd 2009
Plates
Grade A
8X1250/1500
| Location | Change |
| Chennai | -1% |
| Delhi | -2% |
| Kanpur | -1% |
| Kolkata | 0% |
| Mumbai | 0% |
Change is on January 29th 2010 as compared to January 22nd 2009
Plates
GRADE B
12-20X2500
| Location | Change |
| Ahmedabad | -1% |
| Bangalore | -2% |
| Chennai | 0% |
| Delhi | -6% |
| Indore | -1% |
| Kanpur | -1% |
| Kolkata | 0% |
| Mumbai | 0% |
| Raipur | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
CR
DSK
0.63x1000
| Location | Change |
| Ahmedabad | -1% |
| Chennai | 0% |
| Delhi | 8% |
| Kanpur | 0% |
| Kolkata | -2% |
| Mumbai | -1% |
| Pune | -1% |
Change is on January 29th 2010 as compared to January 22nd 2009
GC
100Gms
0.4
| Location | Change |
| Bangalore | 2% |
| Chennai | 1% |
| Delhi | 1% |
| Kanpur | 0% |
| Kolkata | 1% |
| Mumbai | 0% |
Change is on January 29th 2010 as compared to January 22nd 2009
4. Indian Import Levels
It is reported that impacted by falling Chinese domestic steel price, piling up steel inventory and the worry of government’s restriction on cash liquidity, Chinese mills are decreasing their HRC export quotations.
As per market reports, most of the offers from Chinese sellers for HRC in SS400 grade for 3mm to 12mm thickness in standard widths of 1250mm & 1500mm are in the range of USD 570 per tonne to USD 575 per tonne CNF basis.
But some of the aggressive sellers, who have sold large volumes of Chinese HRC into India in last 6 months, are reported to have offered USD 565 per tonne CFR India also. Market sources expect that Chinese mills may agree for lower prices if firm bid is presented to them
The offers for this spec were in the range of USD 580 per tonne to USD 590 per tonne in the first week of January.
Considering the current USD:INR exchange rate of 46.07, USD 565 per tonne on CFR basis translates to less than INR 28,000 per tonne EX port plus CVD and 4% SCD as against about INR 31000 plus per tonne from Indian domestic producers on like to like basis thus improving import viability.
Unconfirmed reports also pointed out of a recent transaction of import of Chinese HRC in cold rolling grade at USD 580 per tonne on CFR basis.
But Indian buyers are adopting cautious approach as the Indian domestic prices of HR may weaken on global pressures by the time cargos arrive. Moreover, Chinese mills may reduce prices further before they break for New Year vacations in mid February.
On the other hand, CIS HR producers are looking to increase levels on cost pressures and restricted availability and we need to wait to see their reaction to Chinese aggression.
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