Pakistan: Imported Scrap Prices Stable in Recent Deals

SteelMint learned in recent conversations with industry participants that despite imported scrap offers continued slightly inching up, prices reported mostly stable on a weekly basis. While purchase activity was comparatively quieter this week after aggressive booking reported last week and steelmakers remained watchful, settling into the new taxation system's procedures.

SteelMint's assessment for containerized Shredded 211 scrap from US and UK stands at USD 320-325/MT, CFR Qasim similar to last week's report as the market remained stable in terms of prices, however, limited demand from the end users kept trades volumes low this week. Few prominent scrap yards in UK were reported to be offering at USD 328-330/MT CFR, as supply with yards in UK remains tight, in comparison to other European suppliers.

Assessment for Dubai origin HMS stands at around USD 315/MT, CFR, slightly dropping from last week, while South African HMS 1&2 assessed at around USD 320/MT, CFR Qasim.

Few customers have returned back for scrap buying who were out of the market for almost more than a year and this has resulted in an increase in imported scrap enquiries in the market, being scrap processors in the local market in a panic of stricter documentation imposed by the government.

Pakistani Rupee continued showing volatility, however, settled down at 156-157 levels today same as the last week against USD.

Domestic steel market awaits for more clarity, stands more or less same - Most of the manufacturers have still not turned operational awaiting clarity on adjustment procedures and uncleared sales tax framework. No major production activities observed throughout the country after 1st July due to lack of clear policy of FBR and slower market activities.

Everyone is being very cautious at the moment. Furthermore, stock taking is being done by the FBR for all the steel units in order to check the raw materials and finished steel inventories declared by the steel manufacturers, shared a source.

Rebar prices after inclusion of 17% FED observed sharp jump, however, got stabilized over this week. In Northern region rebar average selling prices assessed at around PKR 115,000-116,000/MT, ex-works (USD 727-733) meanwhile, asking rates of rebar by Southern region (Karachi) steel mills heard at around PKR 116,000-117,000/MT, ex-works.

SteelMint's assessment of CC billet G-60 remained PKR 97,000-97,500/MT (USD 613-617), ex- works. Domestic scrap prices equivalent to Shredded lowered to PKR 67,000-67,500/MT (USD 424-427) ex-works inclusive of taxes. Limited buying could have resulted in pressuring steel prices slightly as compared to the previous week.

Source: SteelMint Research