South Asia: Imported ferrous scrap market under pressure, offers drop amid inventory pressure on suppliers

The South Asian ferrous scrap market remained under pressure. In India, inquiries remained subdued, with minimal activity noted. Pakistan experienced a slight increase in demand, resulting in bookings of shredded scrap at lower rates. Bangladesh saw moderate purchasing, accompanied by significant declines in bulk offers from the US. Additionally, imported scrap prices in Turkiye witnessed a substantial decline, with further decreases expected in the low $370/t range.

Shredded scrap offers increased by $1/t in India but decreased by $1-2/t in Pakistan and Bangladesh. US bulk HMS (80:20) offers to Turkiye declined sharply by $7/t compared to the previous day.

Overview

The imported ferrous scrap market in India remained quiet today, with no strong inquiries reported. Shredded scrap indicative offers from major exporting nations ranged between $400-410/t CFR, while HMS (80:20) offers stood at $375-380/t CFR.

A representative from a trading company noted, "We haven't received any solid inquiries for imported material today. Additionally, the declining Turkish market has also affected sentiment."

Another trader commented, "Indian buyers are not offering competitive prices compared to other South Asian buyers like Bangladesh and Pakistan."

A steel mill representative mentioned, "The apparent demand in our market correlates with new developments in projects and infrastructure. We anticipate an increase in demand post-election."

Additionally, in Pakistan, there was a slight increase in demand for imported scrap, albeit at reduced rates. Buyers capitalised on this opportunity and booked approximately 2,000-3,000 t of shredded scrap at $410/t CFR Qasim.

In Bangladesh, the purchase of imported scrap continued at a moderate pace. Market sources indicated a significant drop in bulk offers from the US, with HMS (80:20) scraps ranging around $400-405/t CFR Chattogram and shredded scrap at approximately $410/t CFR. Additionally, the disparity between bulk and container offers has narrowed, with a minimal difference of $2-5/t.

Meanwhile, containerised shredded scrap was quoted at $415-418/t CFR, while HMS (80:20) scraps were offered at $400-405/t CFR.

The imported scrap prices in Turkiye have recently undergone a significant decline, driven by the expected decrease in the US scrap prices in March, following the downturn in its steel product prices. Traders anticipate that scrap prices could potentially drop to the low $370/t range.

In line with this trend, a steel mill located in the Mediterranean region secured HMS (80:20) scrap at $376/t CFR Turkiye, along with bonus scraps at $396/t CFR from the US. Similarly, another mill in the Aegean region obtained HMS (80:20) at $377/t and bonus scrap at $398/t CFR from the US. However, the exact quantity of the purchase for the latter could not be verified at the time of publishing this report.

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $406/t CFR Nhava Sheva, up by $1/t d-o-d.

Pakistan: UK-origin shredded scrap indicatives were assessed at $410/t CFR Qasim, down by $1/t d-o-d.

Bangladesh: UK-origin shredded scrap prices were assessed at $418/t CFR Chattogram, down by $2/t d-o-d.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $376/t CFR Turkiye, down by $7/t d-o-d.

Outlook

Imported ferrous scrap offers are expected to continue facing downward pressure, driven by inventory build-up at suppliers end and pressure from major key importing markets due to the availability of other alternatives and weak finished steel demand in the domestic market.