Pakistan: Imported Scrap Prices Rangebound on Limited Demand
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SteelMint learned in recent conversations with industry participants that Pakistan's currency - PKR has continued recovery in the past couple of days after hitting record high levels of 153-54 closing last week. As per State bank of Pakistan (SBP), the exchange rate of dollar was traded slightly below PKR 150 levels recently. The government and IMF have reached an agreement on bailout package of $6 billion over the period of next three years.
Imported scrap prices rangebound - SteelMint's assessment for containerized Shredded 211 scrap from US and UK stands at USD 330-333/MT, CFR Qasim, slightly up against the last week, however, remained rangebound against the offer levels heard closing last week at around USD 333-335/MT, CFR Qasim.
In recent deals confirmed, Shredded 211 scrap traded in containers at USD 329-331/MT, CFR Qasim from US origin and at around USD 333-335/MT, CFR from UK and Europe. However, the availability of offers remained very limited in the market.
An assessment of Dubai origin HMS 1 stands unchanged at USD 330-333/MT, CFR depending on quality while South African HMS 1 is being reported at around USD 328-330/MT, CFR Qasim.
Market likely to slow down on upcoming Eid holidays - Pakistan's steel market is likely to close down during 3rd-9th June on an account of Eid holidays. This week is considered to be the last active working week before going for holidays' closure which is expected to start with closing this week and thus, limited deals are being concluded.
Local steel prices slightly down on recovering PKR against USD - After domestic steel prices shot up last week, Pakistan observed softening of prices amid recovering PKR against USD.
Domestic scrap prices rise further amid acute shortage - Domestic scrap prices equivalent to Shredded surged to PKR 64,000-64,500/MT (USD 423-426) ex-works inclusive of taxes, up PKR 1,000/MT (USD 7) against last week. SteelMint's assessment of local billet remained at PKR 81,500-82,000/MT (USD 538-539) ex-works.
"Domestic scrap prices continued uptrend despite the recovery of PKR as its availability has turned very low. Local steel prices to increase sharply once participants return after the Eid holidays in the first week of June" shared one of the leading steelmakers in the country.
Rebar prices in the Northern region remained more or less same at around PKR 100,000-101,000/MT, ex-works (USD 660-667) meanwhile, Southern region rebar average selling prices reported at around PKR 103,000/MT, ex-works while asking rates of leading mills in Southern region have stabilized for rebar G-60 and reported at around 104,000-105,000/MT, ex-works inclusive of local taxes. Leading mills in the country remain optimistic about sharp rise in both demand and prices after Eid holidays.
SteelMint's local steel price assessment -
| Particular (Average Selling Prices) | 28-May'19 | Last assessment on 21-May'19 | Change |
| PKR/MT | PKR/MT | PKR | |
| Local Scrap (Equivalent to Shredded) | 64,000-64,500 | 63,000-63,500 | 1,000 |
| Bala (Local Billet) | 81,500-82,000 | 81,500-82,000 | 0 |
| CC Billet (Grade 40) | 85,000-85,500 | 86,000-86,500 | -1,000 |
| CC Billet (Grade 60) | 86,000-86,500 | 87,000-87,500 | -1,000 |
| Deformed bar (G-60), Ex-Punjab/KPK | 100,00-101,000 | 100,00-101,000 | 0 |
| Deformed bar (G-60), Ex-Sindh (Karachi) | 102,000-103,000 | 102,000-103,000 | 0 |
Source: SteelMint Research
