South Asia: Imported ferrous market witnesses price drop in India, Bangladesh

On Monday, the South Asian ferrous scrap index displayed mixed trends. In India, reduced offers failed to attract buyers due to weaker steel demand and alternative raw materials, coupled with limited market activity due to the Janmashtami holiday. In Pakistan, prices remained stable with minimal trading activity. Bangladesh experienced a decline in fresh offers from Europe, but buyer interest was subdued as steelmakers adopted a cautious wait-and-see approach. In Turkiye, prices held steady despite concerns about limited shortsea cargo availability, with ongoing speculation that the market may have reached its bottom.

Overview

India: The ferrous scrap market remained sluggish, with no buyers even at $370/t for HMS, suggesting potential for further price declines. Market predictions were increasingly difficult as buyers were unresponsive at various price levels, causing significant turbulence for steelmakers. Shredded scrap was being quoted at $385-390/t, while HMS (90:10) from Australia was around $380/t. Offers from Australia to Chennai were at $360/t. But in Chennai, offers were few at $395-400/t, and finding buyers was challenging. Additionally, other markets were partially closed due to Janmashtami.

An official representing a major trading house said: "Shredded scrap offers from the US were at $388/t for 25 tonnes (t) loading in Chennai. It was difficult to find buyers. Similarly, Australian HMS offers were at $370-372/t for 20/21 t loading in Chennai. Buyers were drawing comparisons to the market downturn of 2008."

Pakistan: Pakistani buyers have received offers for HMS at $385-390/t and fabrication scrap at $415/t from the UAE. Meanwhile, UK-origin shredded scrap offers were around $400/t. However, mills were showing little interest. In fact, they were hesitant to make bookings. The market's inactivity suggested a potential decrease in rebar and billet prices in the near future.

According to market insiders, UK shredded scrap was sold at $398-400/t CFR Qasim. Rebar prices were under pressure, with producers selling below official rates due to weak liquidity.

Bangladesh: Bangladesh's imported ferrous scrap market remained quiet with no major trades reported for the day. Weak construction activities continued to impact rebar demand, leading to slow scrap procurement. Indicative offers for shredded scrap from the UK/Europe were reported at $400-405/t CFR Nhava Sheva, while HMS (80:20) offers were at $388-394/t CFR.

Turkiye: Turkish imported ferrous scrap prices remained stable, with US HMS (80:20) at $360/t CFR, and UK HMS (80:20) at $353-355/t CFR. Market volatility persists as sell-side sources withdraw due to unworkable prices, favouring domestic scrap sales. European recyclers are also focusing on domestic sales. Limited scrap availability and high collection costs are affecting the market. Turkish shortsea scrap imports are stable but slightly below premium prices. There is growing optimism that local market prices may have bottomed out, bolstered by rebounds in Chinese billet offers and increased CIS billet exports. Turkish mills are finding Malaysian billet offers too high, preferring lower price targets.

Price assessments

• India: UK-origin shredded scrap indicatives declined by $7/t to $390/t CFR Nhava Sheva from the last closing.
  
  
• Pakistan: UK-origin shredded indicatives remained stable at $396/t CFR Qasim from the last closing.
  
  
• Bangladesh: UK-origin shredded prices were sharply down by $10 at $403/t CFR Chattogram from the last closing.
  
  
• Turkiye: US-origin HMS (80:20) bulk prices were unchanged at $360/t CFR Turkiye from the last closing.
  
  

Outlook: The Indian market is expecting a near-term correction of $15-20/t. However, a rebound is anticipated around Diwali, with a gradual upward movement expected from mid to late September. Meanwhile, in markets like Bangladesh, cash flow and liquidity issues following political disturbances may continue to impact small-scale mills and buyers.