Structure Update: Secondary Market Stable; Demand Remains Unsupported, Primary Stable

Industry Updates:

• Supply Improvements in Primary Market: SAIL IISCO facility is operational, resolving supply issues with heavy structural components, and stockists are now providing previously unavailable RINL round bars.
• Secondary Market Weak Demand: Secondary mills are not facing shortages but report very weak demand, leading to a flat or declining trend in market activity this week.
• Steel PLI Scheme Update: India’s Ministry of Steel is revising the PLI scheme for specialty steel, expanding eligibility to include greenfield projects and value-added products, with disbursals expected to start in 2025.

Price

• Secondary Market: Secondary markets are stable across all regions today.

• Primary Market: This month's price revision shows a Rs 500/mt decrease by SAIL, JSPL has rolled over the rates, and RINL has reduced prices by Rs 700/mt.

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

• Ex-Raipur: Rs 46,100/mt

• Ex-Hyderabad: Rs. 47,900/mt

• Ex-Raigarh: Rs 46,100/mt

• Ex-Chennai: Rs. 47,700/mt

• Ex-Mandi Gobindgarh: Rs. 47,500/mt

• Ex-Durgapur: Rs. 44,800/mt

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

• Ex-Durgapur: Rs. 55,250/mt

• Ex-Chennai: Rs. 58,750/mt

• Ex-Hyderabad: Rs. 57,250/mt

• Ex-Ahmedabad: Rs. 57,750/mt

• Ex-Ghaziabad: Rs. 55,750/mt

Demand and Supply

• Primary: The SAIL IISCO facility is currently operational. The supplier has heavy structural components in stock, and SAIL has provided the rolling timeline for the items, which should arrive in the next seven to ten days. Distributors are receiving stocks, and supply issues are being resolved. Additionally, stockists can now provide RINL round bars that were previously unavailable. By the end of this month, the primary supply issues will be resolved.
• Secondary: Secondary mills are not concerned about shortages as they have ample finished material. However, market demand is virtually nonexistent.

News

India’s Ministry of Steel is reworking the Production-Linked Incentive (PLI) scheme for specialty steel to broaden its scope and ease eligibility criteria. Launched in 2021 with a $765 million corpus, the scheme initially targeted brownfield projects but may now include greenfield investments and green steelmaking processes. Companies expanding their product portfolios with value-added products could also be eligible. Disbursals, expected to start in 2025, will begin with $6 million, though previous delays in project completions have resulted in lower disbursal amounts compared to the total corpus.

Expert Opinion

The secondary market is expected to exhibit a flat or declining trend this week due to weak demand, while the primary market appears to be growing in the upcoming month.