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Pakistan: Imported scrap prices dip $6/t w-o-w as demand weakens

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Melting Scrap

BigMint Bureau

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14 Jan 2025, 20:15 IST

Pakistan: Imported scrap prices dip $6/t w-o-w as demand weakens

Market subdued due to limited trading

Steel mills operating at reduced capacity

Pakistan's imported ferrous scrap market experienced a slow trend over the past seven days, with demand from mills significantly dampened. According to market insiders, panic is starting to set in, as suppliers offered UK shredded at $383-385/tonne (t). With trading remaining limited, prices gradually trended downwards, towards $382-383/t.

BigMint's weekly assessment revealed that European shredded was at $384/t CFR Qasim, dropping by $6/t w-o-w.

Market comments

A Sindh-based mill representative said, "There is currently a gap of PKR 5,000/t ($18/t) between the market price and the listed price for rebar. This difference is between cash sales, credit sales with 30-day terms, and advance booking sales, where full payment is made upfront, with delivery set for 2-3 months later."

"The market remains sluggish, with local scrap prices increased to PKR 140,500-141,000/t($504-506/t). Rebar prices are stable at 240,000-242,000/t($861-869/t) exw. We recently secured 1,500 t of shredded from a major UK yard at $383/t, while current offers hovered at around $383-385/t. If bigger yards can sell at $383/t, then others might offer material at $380/t," stated a major Karachi-based trading house representative.

Another source highlighted, "As a Karachi-based steel mill, we are feeling the pressure with the recent market conditions. Domestic scrap prices are hovering at PKR 141,000-142,000/t ($506-510/t), billets are at PKR 209,000/t ($750/t), and bars are at PKR 238,000-240,000/t ($854-860/t). We are actively trying to secure deals at this level to manage the situation."

A mill-side representative informed BigMint, "Workable levels eased to around $384-385/t CFR Qasim, with inquiries observed at these rates yesterday. Rebar prices remain steady at PKR 240,000-242,000/t ($862-868/t), while scrap prices were firm in the PKR 140,000-142,000/t ($502-510/t) range. We are actively monitoring the situation to align our procurement decisions with market conditions."

In the past seven days, approximately 3,000-4,000 t of mixed scrap from the UK and the Middle East were booked at $355-390/t on a CFR Qasim basis.

Steel mills operated at reduced capacity this week, running at around 40-45% of their maximum output. There are slow signs of a potential sales recovery, but it remains uncertain in the near term.

Outlook

The market is expected to stay range-bound in the near term, with offers likely settling at around $380/t as suppliers push down their levels in response to weak demand from buyers. Limited trading volumes, coupled with seasonal factors, are likely to keep market sentiment subdued, leading to price stabilisation around $380/t for the time being.