India: Imported HMS scrap trade improves on lower offers, monsoon stocking

India's imported scrap market remained active this week in terms of imported HMS. The country's steel mills and buyers have booked multiple scrap cargoes to secure deliveries before the monsoon. Meanwhile, domestic volatile prices supported the imported scrap trade this week.

Recent deals and offers

• Fresh offers for UK-origin shredded are at $530-535/t CFR levels, down by $10/t w-o-w. Notably, offers fell to five-month lows. Around 300-500 t of US-origin shredded scrap is heard to have been sold at $527/t CFR NHSV.
  
  
• UK-origin shredded of 500 t were heard sold at $542/t towards last weekend.
  
  
• 300 t of UAE-origin HMS 1 was sold at $505/t CFR NHSV recently.
  
  
• Another 1,000-t deal of Yemen-origin HMS 1&2 (80:20) was sold at $475/t CFR.
  
  
• Western India-based mills booked around 1,500 t of Dubai-origin HMS 1&2 (80:20) at $515/t CFR NHSV and Mundra earlier in the week.
  
  

Interestingly, buyers have preferred imported UAE-origin material, considering the landed price of UAE-origin HMS material is more cost-effective. Currently, the offers for HMS 1&2 (80:20) are now at $490-495/t (INR 38,000-38400/t) CFR NHSV levels and the landed cost will stand at INR 40,000/t, while domestic HMS 1&2 (80:20) is now available at INR 42,700/t Mumbai. However, the prices have come down by INR 700/t w-o-w.

Near-term price expectations remained unclear owing to the prevailing uncertainty in steel prices.

Market highlights

• Rupee hits all-time low against dollar: The rupee weakened to an all-time low against the dollar on elevated global crude oil prices. Currently, it is being traded at 77.68 against the dollar.
  
  
• Ferrous scrap imports inch up in April: India's ferrous scrap imports were recorded at 390,000 t in April, up 15% m-o-m from 340,000 t in March. The UAE was the largest supplier with 110,000 t followed by Venezuela and Yemen at 30,000 t each. On a y-o-y basis, import volumes improved by 22% from 320,000 t in April, 2021.
  
  
• Rebar prices drop: IF-route rebar market saw a pick-up in trade inquiries towards the weekend. Although prices increased in a few regions, trade remained weak. Furthermore, increasing raw material prices in the key markets could not lend support to rebar prices. A slight improvement has been seen in transactional activity but the momentum is yet to gear up. Manufacturers adjusted the tradable discounts as per the movement of raw material prices.
  
  

Domestic IF rebar (Fe 500) prices stand at INR 58,500/t ($753/t), registering a further sharp fall by INR 2,100/t ($27/t) from INR 60,600/t ($780/t) exw-Mumbai.