Pakistan: Imported ferrous scrap prices remain stable w-o-w; cautious optimism likely post-monsoon

Pakistan's imported ferrous scrap prices continue to remain stable w-o-w as earlier the country faced severe rainfall that kept domestic steel demand sluggish. Some traders also remained reluctant to sell scrap to India as buyers in neighbouring Pakistan paid better prices.

• BigMint's assessment of European-origin shredded scrap was at $400/t, stable w-o-w.
  
  

Market Commentary

Market insiders report that a currency crunch is further limiting mill purchases, with only a few mills actively booking scrap, while others adopt a wait-and-watch approach, observing market trends.

A trade source mentioned: "The cost of selling to both India and Pakistan would be at a similar level for us, so we would not prefer selling to India and also to Pakistan, because payment-related delays are weighing on trades as well.

As per industry reports, cold re-rollers have urged NTC to address anti-dumping evasions through slight modifications in chemistry and HS codes, requesting these items be added to the anti-dumping list.

A major steel mill source said, "Imported shredded scrap offers remained stable at $400-405/t, with deals closing at $398-400/t. HMS(80:20) from UAE ranged at $375-380/t. Whereas, UAE's shredded scrap remained cost-effective with UK-origin materials."

Around 3,500-5,000, t of UK and UAE-origin shredded scrap were booked at $398-402/t on a CFR Qasim basis during the last seven days.

Domestic market: Billet and rebar prices remained range-bound with nominal increase in some regions and stood at PKR 210,000-212,000/t and PKR 245,000-246,000/t exw, respectively. Domestic scrap was priced at PKR 145,000-147,000/t exy, up by PKR 2,500/t. The spread between rebar and domestic scrap prices in Pakistan hovered at around PKR 100,000-102,000/t.

According to market feedbacks, rebar and billet prices remain under pressure, but the end of rains this week may bring some relief to the industry.

Pakistan's new $7-billion IMF bailout is facing delays, raising concerns over geopolitical factors. Deputy PM Ishaq Dar criticized the IMF for stalling disbursement, hinting at intentional delays. The delay, linked to pending debt rollovers from China, Saudi Arabia, and the UAE, has fuelled uncertainty in markets. Speculation suggests the IMF might be waiting for Pakistan to secure debt relief from China, similar to Sri Lanka, before releasing funds. Clarity from the government is needed to address market concerns and reduce uncertainty.