Pakistan: Imported scrap offers move down; domestic steel inches up

Imported scrap offers to Pakistan witnessed a sharp fall over the last week, following the downtrend in all South Asian markets recently as well as the overall global trend. Imported scrap prices moved down in recent deals concluded, while average bookings were reported in small quantities.

SteelMint's assessment for shredded 211 from UK/Europe and North America stands at $278-280/t CFR Qasim level, considerably dropping by around $ 10/t against the opening of last week when offers were recorded at around $ 290/t, which had later moved down to $285/t CFR level by last week closing. Currently, shredded offers range between $277-279/t from USA and $279-281/t CFR from the UK.

Among the transactions for Shredded scrap reported in the recent days, the price range was wide. Premium UK suppliers sold Shredded at $282-283/t recently, with a global trader concluding 3,500 t in this range this week, while other deals from UK and Europe were reported at around $280/t CFR mark in the last 1-2 days.

Rumors from sources about a booking at $ 275/t CFR (Shredded) could not be confirmed. "Now deals have happened at $ 280/t level and offers are likely to drop to $275/t this week in coming days, which is a favorable price level for Pakistani buyers, but low sales of finished steel will be a hurdle against very active buying" Shared a prominent trader in the region.

Domestic Market
Domestic market witnessed finished steel sales getting slow due to limited demand amid "smart lockdown" in construction sector activities. However, instead of lowering the steel offers, steelmakers had to slightly hike the prices of steel bars because of 2 factors - hike in local scrap prices amid shortage of material; and increased input/running costs due to operating at less production level (low CUF).

Local scrap prices (eq to Shredded) observed a rise by PKR 1,500/t this week and stood at PKR 71000/t inclusive of taxes, while deformed bar prices were hiked by PKR 1000/t and now stand at PKR 112,000-113,000/t for Punjab and PKR 113,000-114,000/t for South region, ex plant basis, inclusive of taxes.