Indian domestic steel prices continued to exhibit strong upward sentiments last week.
Although market players had already increased their prices before end of March, increase of about INR 2500 per tonne by Indian steel majors for both long and flat products further propelled the prices at certain locations. Upward correction in other places, especially for flat products, is likely to happen on week opening.
It was reveled that global miners have been able to secure about 95% hike for iron ore on quarterly basis thus putting an end to annual benchmark negotiations. Indian state owned iron ore majors NMDC and OMC have also announced major hikes last week, which would support higher prices for sponge iron and in turn long products in coming days.
The continued surge is mainly on cost push sentiments driving users as well as stockiest to pre pone their purchases which has made it difficult to gauge growth in real demand although steel mills are quite buoyant about it. The prices are inching to pre crisis levels and have to correct. The moot question is when? Some market players say May end some say June and few say July.
An important point to be noted is the actual effect of cost of raw materials.
Change in raw material costs
| Input | Old | New | Change | % |
| Iron ore | 80 | 150 | 70 | 88% |
| Coking coal | 150 | 230 | 80 | 53% |
| Scrap | 250 | 425 | 175 | 70% |
In USD per tonne
On CFR basis
Change in steel making costs
| Stage | Old | New | Change | % |
| HOT METAL | 270 | 451 | 181 | 67% |
| LIQUID STEEL | 344 | 535 | 191 | 55% |
| SLAB COST | 370 | 565 | 195 | 53% |
| HOT BAND COST | 400 | 597 | 197 | 49% |
In USD per tonne
This is without S&G, depreciation and interest
Consumptions are as per global benchmark
Route is BF-BOF-Caster-HSM
Thus, even for pure play steel mills which are buying iron ore at USD 150 per tonne and coking coal at USD 230 per tonne, the cost of HR works out to USD 600 per tonne or say about INR 27,600 per tonne. This clearly reflects that the current rally in prices is not solely on account of higher costs but is driven mainly by hyped sentiments and partially by domestic demand and supported by surge in global levels.
Weekly Summary
The Indian Long Product Price Index ILPPI increased by whooping 235 points whereas Indian Flat Products Index IFPPI increased by 273 points. The overall price index INDSPI increased by 253 points.
| Class | 26-Mar | 02-Apr | Change | % |
| ILPPI | 7571 | 7806 | 235 | 3.1% |
| IFPPI | 8302 | 8575 | 273 | 3.3% |
| INDSPI | 7919 | 8172 | 253 | 3.2% |
ILPPI - Indian Long Product Price Index
IFPPI - Indian Flat Product Price Index
INDSPI - Indian Steel Price Index
Long Products
| Category | 26-Mar | 02-Apr | Change | % |
| PI - TMT | 7457 | 7782 | 325 | 4.4% |
| PI - WRC | 7974 | 8152 | 178 | 2.2% |
| PI - Angle | 7176 | 7341 | 165 | 2.3% |
| PI - Channel | 7222 | 7425 | 203 | 2.8% |
| PI - Joist | 6672 | 6822 | 149 | 2.2% |
PI - Product Index
Flat products
| Category | 26-Mar | 02-Apr | Change | % |
| PI - Narrow Plates | 7918 | 8182 | 263 | 3.3% |
| PI - Wide Plates | 8168 | 8348 | 181 | 2.2% |
| PI - Hot Rolled | 8142 | 8412 | 269 | 3.3% |
| PI - Cold Rolled | 8845 | 9154 | 309 | 3.5% |
| PI - Galvanized | 8789 | 9133 | 343 | 3.9% |
PI - Product Index
These indices have base of 10,000 as on July 1st 2008
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1. Input material
Melting scrap
80:20
HMS
| Location | Change |
| Chennai | 2% |
| Kandla | 7% |
| Kanpur | 6% |
| Kolkata | 0% |
| Mandi | 8% |
| Mumbai | 5% |
Change is on April 2nd 2010 as compared to March 26th 2010
Alang
| Product | Size | Change |
| Plate cuttings | 1" | 7% |
| Ships | Mixed | 6% |
Change is on April 2nd 2010 as compared to March 26th 2010
Pencil ingot
| Location | Change |
| Ahmedabad | 2% |
| Bhiwari | 7% |
| Durgapur | 5% |
| Ghaziabad | 7% |
| Hyderabad | 5% |
| Jaipur | 5% |
| Jamshedpur | 0% |
| Kanpur | 4% |
| Kolkata | 0% |
| Mandi | 3% |
| Mumbai | 6% |
| Muzzafarnagar | 5% |
| Nagpur | 7% |
| Raigarh | 0% |
| Raipur | 7% |
| Rourkela | 4% |
| Rudrapur | 3% |
Change is on April 2nd 2010 as compared to March 26th 2010
Pig Iron
| Location | Change |
| Agra | 5% |
| Jallandhar | 4% |
| Kolkata | 5% |
| Raipur | 6% |
Change is on April 2nd 2010 as compared to March 26th 2010
Sponge iron
| Location | Change |
| Bellary | 13% |
| Kolkata | 0% |
| Raigarh | 15% |
| Raipur | 0% |
| Rourkela | 0% |
Change is on April 2nd 2010 as compared to March 26th 2010
2. Long products
TMT
Fe 415
12mm
| Location | Change |
| Ahmedabad | 4% |
| Chennai | 1% |
| Delhi | 4% |
| Indore | 5% |
| Kanpur | 3% |
| Kolkata | 3% |
| Mandi | 12% |
| Mumbai | 5% |
| Raipur | 8% |
Change is on April 2nd 2010 as compared to March 26th 2010
WRC
SWR14
5.5/6
| Location | Change |
| Chennai | 0% |
| Delhi | 3% |
| Kanpur | 3% |
| Kolkata | 0% |
| Raipur | 6% |
Change is on April 2nd 2010 as compared to March 26th 2010
ANGL
Grade A
65X65X6
| Location | Change |
| Ahmedabad | 4% |
| Bangalore | 4% |
| Chennai | 0% |
| Delhi | 3% |
| Indore | 7% |
| Kanpur | 2% |
| Kolkata | -3% |
| Mandi | 4% |
| Mumbai | 5% |
| Raipur | 5% |
Change is on April 2nd 2010 as compared to March 26th 2010
CNHL
Grade A
75/40
| Location | Change |
| Ahmedabad | 4% |
| Bangalore | 5% |
| Chennai | 0% |
| Delhi | 3% |
| Indore | 5% |
| Kanpur | 2% |
| Kolkata | -1% |
| Mandi | 5% |
| Mumbai | 5% |
| Raipur | 6% |
Change is on April 2nd 2010 as compared to March 26th 2010
JSTI
Grade A
250X125
| Location | Change |
| Ahmedabad | 3% |
| Bangalore | 3% |
| Chennai | 0% |
| Delhi | 3% |
| Indore | 5% |
| Kanpur | 2% |
| Kolkata | -1% |
| Mandi | 4% |
| Mumbai | 5% |
| Raipur | 6% |
Change is on April 2nd 2010 as compared to March 26th 2010
3. Flat products
HRC
Tube
2.5x1250
| Location | Change |
| Ahmedabad | 1% |
| Bangalore | 2% |
| Chennai | 0% |
| Delhi | 3% |
| Indore | 5% |
| Kolkata | 1% |
| Ludhiana | 1% |
| Mumbai | 13% |
Change is on April 2nd 2010 as compared to March 26th 2010
Patra
| Location | Change |
| Delhi | 3% |
| Ludhiana | 1% |
| Mandi | 8% |
Change is on April 2nd 2010 as compared to March 26th 2010
Plates
Grade A
8X1250/1500
| Location | Change |
| Chennai | 0% |
| Delhi | 3% |
| Kanpur | 3% |
| Kolkata | 1% |
| Mumbai | 14% |
Change is on April 2nd 2010 as compared to March 26th 2010
Plates
GRADE B
12-20X2500
| Location | Change |
| Ahmedabad | 0% |
| Bangalore | 4% |
| Chennai | 0% |
| Delhi | 3% |
| Indore | 5% |
| Kanpur | 1% |
| Kolkata | 1% |
| Mumbai | 9% |
| Raipur | 5% |
Change is on April 2nd 2010 as compared to March 26th 2010
CR
DSK
0.63x1000
| Location | Change |
| Ahmedabad | 1% |
| Chennai | 0% |
| Delhi | 2% |
| Kanpur | 1% |
| Kolkata | 1% |
| Mumbai | 15% |
| Pune | 15% |
Change is on April 2nd 2010 as compared to March 26th 2010
GC
100Gms
0.4
| Location | Change |
| Bangalore | 5% |
| Chennai | 0% |
| Delhi | 6% |
| Kanpur | 5% |
| Kolkata | 0% |
| Mumbai | 12% |
Change is on April 2nd 2010 as compared to March 26th 2010
4. Indian Export Levels
Export levels of HDG and PPGI from Indian mills surged further last week
| Item | Grade | Size | Delivery | Change |
| HDG | 100Gms | 0.4 | FOB Mumbai | 25 |
| HDG | 100Gms | 0.58 | FOB Mumbai | 0 |
| HDG | 275Gms | 0.75 | FOB Mumbai | 0 |
| PLTS | Structural | 12-40x2.5 | FOB Vizag | 20 |
| PPGI | Standard RAL | 0.4 | FOB Mumbai | 0 |
Change is on April 2nd 2010 as compared to March 26th 2010
Change is in USD per tonne
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