Structure Update: Secondary Market Price Declines; Primary Strong

Key Updates:

• Secondary Market Price Changes: Secondary markets show price declines, with Raipur down by Rs 300/mt, Hyderabad down by Rs 500/mt, and Chennai down by Rs 200/mt. Mandi remains stable.
• SAIL IISCO Facility Update: SAIL's IISCO facility is fully operational, with some heavy beam sections still unavailable. Stockists are now supplying previously unavailable RINL round bars, addressing supply concerns.
• KIOCL-NMDC Merger Proposal: The Indian government is proposing a merger between KIOCL and NMDC to enhance India's iron ore export sector. The merger would combine KIOCL’s pellet-making and NMDC’s mining operations.

Structure Prices

• Secondary Market: Secondary markets in Raipur are down by Rs 300/mt, Mandi is stable, Durgapur is down by Rs 300/mt, Hyderabad is down by Rs 500/mt, and Chennai is down by Rs 200/mt.

• Primary Market: This month's price revision includes SAIL up by Rs 500/mt, JSPL up by Rs 500/mt, and RINL up by Rs 500/mt.

• The offers for 100 x 50 Channel in the Secondary Steel market are as follows:

• Ex-Raipur: Rs 46,000/mt

• Ex-Hyderabad: Rs. 47,500/mt

• Ex-Raigarh: Rs 46,000/mt

• Ex-Chennai: Rs. 47,600/mt

• Ex-Mandi Gobindgarh: Rs. 47,500/mt

• Ex-Durgapur: Rs. 44,600/mt

• The offers for 100 x 50 Channel in the Primary Structural Steel market are as follows:

• Ex-Durgapur: Rs. 55,750/mt

• Ex-Chennai: Rs. 59,250/mt

• Ex-Hyderabad: Rs. 57,750/mt

• Ex-Ahmedabad: Rs. 58,250/mt

• Ex-Ghaziabad: Rs. 56,250/mt

Structure Demand and Supply

• Primary: The SAIL IISCO facility is fully operational at this point, but some heavy beam sections are still unavailable with distributors. SAIL has provided a rolling schedule for these sections, which should arrive by the end of this month. Additionally, stockists are now supplying RINL round bars that were previously unavailable. The fundamental supply concern is now being resolved.
• Secondary: Secondary mills are unconcerned about shortages as they have a large supply of completed material on hand. However, demand is poor, and manufacturers are offering discounts on basic rates.

News

The Indian steel ministry is proposing a merger between state-run companies KIOCL and NMDC, according to a government official. The merger, which would combine KIOCL's pellet-making capabilities with NMDC's mining operations, aims to strengthen India's iron ore export sector. Following the merger, NMDC plans to export iron ore pellets produced by KIOCL, expanding its global reach. However, the official, who spoke on the condition of anonymity, did not provide further details about the timeline or terms of the proposed merger. This move is part of the government's efforts to streamline the sector and boost exports.

Expert Opinion

While the primary market saw a price increase this month, it is anticipated to return to its present levels in response to current demands, while the secondary market is projected to remain under pressure due to low demand.