India: Imported scrap buying cools down as prices climb to 2.5 years high

Imported scrap prices in India have climbed to 2.5 years high following global rally. Global market seems strong as Turkey has continuously raised scrap prices in the recent deep-sea cargo bookings made. However, the Indian market remained less active as buyers are not aggressively booking cargoes and preferred domestic scrap over imported.

Prices jumped on a combination of factors including the continuing shortage of material as well as logistical issues related to poor availability of containers and rapidly rising freight rates. SteelMint's assessment for Shredded scrap in containers of UK/EU origin stands at $370/t CFR Nhava Sheva, rising significantly by $10/t against end of the last week.

"No aggressive bookings were heard in India this week, neither in bulk nor in exports. Pakistan remained active in imported scrap bookings amongst other South Asian markets. Indian buyers have slowed imported scrap bookings and preferred domestic scrap and sponge iron which exhibited price correction this week." highlighted sources.

Current imported scrap offers-

Domestic scrap market overview - Domestic scrap prices in western India have decreased slightly on a weekly basis. Limited trades and buying inquiries in semi-finished & finished steel market along with falling sponge iron prices remained as the major factors behind decline in scrap prices, SteelMint's domestic melting scrap HMS (80:20) prices stood at INR 25,200/t DAP Jalna (down by INR 1,300/t w-o-w) and INR 25,700 DAP Chennai (remain stable w-o-w).

Sponge iron prices drop on dull inquiries, likely to recover - Continuous decline in billet and finished steel output, sponge iron demand weakened as few bookings have been reported by the mid-sized sponge plants. SteelMint's benchmark assessment for P-DRI & C-DRI stands at INR 24,500/t & INR 24,400/t exw Raipur, respectively. However, trade sources expect prices to increase in the near term backed by improved inquiries today.