Imported scrap prices in Turkiye inch up, South Asian market uncertain
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- Eid holidays likely to dampen demand for scrap in short term
- Depreciation of Turkish lira may support scrap prices
The South Asian scrap market witnessed volatility on the second day of the week. Downtrend in global prices has come to a pause as Eid holidays are about to begin. Meanwhile, Turkish imported scrap prices inched up before the holidays, on Monday, with bulk cargo booking seen from the US. Indian mills, on the other hand, continued with small bookings.
Pakistan and Bangladesh markets started the week slow amid the holiday mood. Steel producers are also out of the market as labourer resources are away for the Eid festival. Overall, the South Asian market scenario remains uncertain.
Market overview
- India: Negotiations have slowed down in the imported scrap space. There is some volatility in the market. Steel mills are procuring material in small quantities amid an uncertain situation. Buyers are looking for prices below $420/t CFR levels. Additionally, suppliers are likely to take advantage of the Eid holidays and may quote various offers to Indian buyers.
- Pakistan: The Pakistani scrap market is also muted, with buyers absent due to the upcoming Eid holidays. However, there is some optimism that prices may go up on account of the depreciation of the Turkish lira. Industry experts believe that the Turkish market is slightly up on account of the currency depreciation. This can support imported scrap prices into Pakistan.
- Bangladesh: The scrap market is also quiet in Bangladesh. The ongoing liquidity issue continues in the country, yet the Eid holidays may give time to evaluate the market scenario closely. Containerised scrap buyers continue to show low interest due to dull finished steel demand which is a spin-off of the monsoons and Eid festival.
- Turkiye: Turkish steelmakers have bought imported scrap cargo ahead of the long holiday period. Imported scrap prices have inched up by $2/t in a recent deal concluded from the US. A West Marmara-based mill secured cargo for July shipment comprising HMS (80:20), shredded, and bonus at $380/t and $400/t each on CFR Turkiye, respectively. Scrap prices continue to remain volatile amid unstable economic conditions in the country.
Price assessments
- India: UK-origin shredded offers stood at $420/t CFR Nhava Sheva, down by $3/t d-o-d.
- Pakistan: UK-origin shredded offers were at $423/t CFR Qasim, same as yesterday.
- Bangladesh: UK-origin shredded offers stood at $445/t CFR Chittagong, down by $5/t d-o-d.
- Turkiye: US-origin HMS 1&2 (80:20) prices were assessed at $380/t CFR Turkiye, unchanged d-o-d.
Outlook
The outlook for the market is uncertain. Some experts believe that prices may dip by another $10-15/t in the near term, while others believe that prices may go up due to the depreciation of the Turkish lira. There may be clarity by Monday, when trade activities in other markets like Bangladesh and Pakistan resume after the holidays.
However, the overall demand for scrap in South Asia is expected to remain weak. The region is facing a number of challenges, including weak economic growth, high inflation, and political instability.
