Pakistan: Imported scrap offers rise while market waits for buyers to return after holidays

Pakistan's imported scrap market improved gradually over the last weekend, despite a hike in offers by $10/t against the beginning of last week. The recent gain in the national currency PKR (Pakistani Rupee) brought some relief to scrap buyers and steel mills, which may support fresh bookings.

The local currency gained PKR 15.3 in the currency exchange market against the US dollar, after hitting an all-time low of 239.3 last week. The rupee started to gain this week and is trading at 224.2 against the dollar.

"The market is stable now, as stocks in the mills are high due to limited demand from end users and almost zero buying inquiry from buyers," a source said.

SteelMint's assessment for Shredded 211 scrap in containers from UK/Europe stands at $475-480/t CFR Qasim, up $15-20/t against last week's opening. Deals of around 2,000-3,000 t shredded scrap in containers were reported at similar price levels before the closing of last week.

The trade activities were closed till 10 August on the occasion of Muharram Ashura holidays. Hence the market activities will resume after the holidays. Market participants expect imported scrap trades to pick up owing to the stability in currency exchange rate.

Domestic steel market yet to pick up: The Domestic steel market has observed weak demand during the last couple of weeks due to heavy rainfall all over Pakistan in the Muharram month. Major mills kept their rebar prices unchanged; however, the workable price levels were around PKR 230,000-233,000/t.

Pakistan domestic prices

Meanwhile, domestic scrap prices have gone up along with rising prices of imported scrap and material shortage. The steel market will enter a phase but it may take two-three weeks, sources informed.

"The market is silent and trade activity may pick up after the Muharram holidays. However, the liquidity crisis is still there, although stability in the currency exchange rate is likely to remain supported," a Pakistan-based scrap trader source said.