South Asia: Ferrous scrap market sluggish amid fewer deals

The ferrous scrap market in South Asia received a moderate response from buyers as offers moved up. Buyers are showing a low appetite for procurement. But, due to the low availability of material in the market, offers rose. However, some deals were concluded at much lower prices compared to what the sellers offered.

Although there are now active Pakistani buyers in the market for small quantities, letters of credit are taking longer to be approved by banks. This is because the government is discouraging imports owing to a lack of foreign exchange reserves. This is hindering trade with Pakistan, but limited deals are being concluded at the current offers.

Bangladesh's imported scrap market remained silent due to issues like new restrictions related to opening of LCs.

Market Comments

"Demand will be there in the coming months but there is no scope for opening LCs on a regular basis. Construction activities are not picking up right now in Bangladesh," said a Bangladeshi buyer.

"The domestic scrap market in Pakistan is in an upward trend. Scrap prices are increasing but material availability is limited, and mills need to buy imported material to balance out. Otherwise, prices will continue to increase," a market participant from Pakistan observed.

Recent trades:

• Around 400 t of containerised shredded scrap of Europe-origin has been booked at a price of $410/t CFR Nhava Sheva.
  
  
• Around 1,000 t of shredded scrap in containers has been booked at a price of $446/t CFR Qasim.
  
  

SteelMint's price assessment

• Europe-origin shredded scrap offers into India were at $445/t CFR Nhava Sheva, which remained unchanged for the day.
  
  
• UK-origin shredded prices stood at $458/t CFR Chittagong, stable d-o-d.
  
  
• UK-origin shredded scrap prices were at $447/t CFR Qasim, unchanged from the last offer.