The current rainy season has definitely taken a toll on steel demand, which is one of the reasons why some market activity in key sectors witnessed decline. Recent estimates show that HMS (80:20) scrap prices are falling by INR 700/t week-on-week and are being quoted at around INR 31,300/t. Billet prices are falling by INR 300 per ton week-on-week to INR 41,500 per ton, while rebar prices are falling by INR 400/t week-on-week and stabilizing at INR 45,800/t. Despite all these changes, prices are stable on a daily basis.
The unpredictable weather is the main reason why the trade activities are slow. This has dampened the demand for finished steel. Many buyers have shifted to need-based procurement instead of bulk purchases, and this caution is evident in both the scrap and finished steel markets. Most transactions are taking place within the INR 31,000-31,500/t range for HMS (80:20), with higher rates applied for extended payment terms. A liquidity crunch, compounded by the monsoon’s lingering effects, has caused further restraint in trade.
International scrap prices are also showing a cautious trend. Shredded scrap offers from Australia are priced around $370/t CFR Chennai, while European-origin material is slightly higher at around $380/t. Despite these prices, buyers are hesitant to make purchases, anticipating further price declines. Similarly, HMS (80:20) scrap from Australian suppliers is offered at approximately $355/t, but again, buyer interest remains low.
In the domestic market, scrap prices have stabilized, with most bids in the INR 31,000-31,500/t range. However, prices have fluctuated depending on payment terms, with longer payment cycles seeing higher rates.
With the rainy season still affecting the region, steel demand is expected to remain subdued. Although the season’s end is approaching, scrap prices are expected to stay within a narrow range of INR +/- 500/t in the near future, reflecting minor fluctuations depending on market conditions. Steel trades are likely to remain moderate through December, with liquidity concerns continuing to influence market sentiment.
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