South Asia: Imported ferrous scrap offers continue to fall d-o-d in dull market

• Indian buyers turn dull Diwali market to their advantage
  
  
• Turkiye buyers bearish on firmer US, Baltic offers
  
  

The South Asian scrap market witnessed a drop d-o-d across key regions. In India, shredded prices fell to $385-$386/tonne (t) affected by a subdued market that saw scant pre-Diwali inquiries. The Bangladesh scrap market is sluggish, driven by low demand and cautious buying.

In Pakistan, shredded offers dropped slightly, despite rising rebar prices. Turkish buyers were bearish on US and Baltic offers. They bid below $360/t for US scrap and showed no interest in EU material. However, US sellers are not keen to sell at below $365/t.

India

Workable levels for shredded in India dropped to $385-386/t, while busheling was at $400/t, depending on the supplier.

With the Indian market set to remain closed this week because of Diwali, traders are aiming to take advantage of the lower prices since they expect fresh shipments to only start by the end of November.

The market expects mixed activities, with bids-offers for HMS (80:20) at $362-370/t CFR Mundra/Chennai. Buying interest is likely to emerge at about $360/t for HMS (80:20) and $372-375/t for HMS 1.

After Diwali, market activity is expected to pick up as suppliers might push their materials into the market before winter. EU supplies are expected to come into the market, by mid-November to early December. However, harsh winter weather in Europe may cause supply disruptions, and potentially increase the flow of scrap from alternate destinations like the US, Brazil, and Australia.

Pakistan

Shredded offers from Europe remained steady at $392-394/t with workable levels hovering below $390/t.

As per a Karachi-based steel mill, the rebar market is weak, amid dull sales. Despite the recent rise in rebar prices, the market is not in a hurry to purchase following muted activity in the construction sector in major regions.

A few reputed companies kept their rates steady at about PKR 245,000-250,000/t. Local steel bars that previously avoided sales tax have raised their prices due to pressure from the tax office.

As full tax recoveries are getting enforced, costs have increased, with previously misappropriated tax amounts being passed on to customers as discounts.

Bangladesh

The Bangladesh imported scrap market continues to witness dull response although suppliers reduced their offers.

As per market insiders, sellers from Singapore and Malaysia are offering 2,000-3,000 t of PNS loading at $420/t. Australian shredded was available at $410/t. Malaysia-origin HMS-1 and PNS bundles were at $400-405/t CFR Chattogram.

Additionally, Hong Kong-origin AB bundles were offered at $395/t followed by Australian HMS (80:20) at $390/t, with a dust content of 2% and a load size of 1,500 t, specifically between 20-21 t loading. Lastly, Australian HMS (90:10) was priced at $400/t for 23-24 t loading.

Turkiye

Turkiye's imported ferrous scrap prices remained range-bound in recent deals concluded from the US and Baltic regions.

However, LME futures for scrap climbed up to $380/t, a significant premium over recent spot transactions.

As per industry insiders, Turkish mills need 32-35 vessels, but demand has not kicked in yet. As we move into November and December, winter conditions and supply tightness are likely to push up prices.

A steel mill source commented, "We will be monitoring the market closely, as yesterday was a national holiday in Turkiye. Prices may be on a downward trend in the coming days. I expect the workable price for US-origin materials to be at around $360/t CFR, while EU materials could sell for $355/t."

Another market participant said: "The market has been suppressed due to an oversupply from Europe, especially to Turkiye. Recyclers who typically offer two cargoes are now offering three, while those who usually sell three are now providing four-five."

Price assessments

India: UK-origin shredded scrap indicatives edged down by $3/t to $387/t CFR Nhava Sheva compared to the previous day.

Pakistan: UK-origin shredded indicatives dropped by $1/t d-o-d to $389/t CFR Qasim.

Bangladesh: UK-origin shredded prices at $392/t CFR Chattogram, drop by $3/t compared to the previous day.

Turkiye: US-origin HMS (80:20) bulk prices edged up by $2/t to $362/t CFR Turkiyecompared to the previous day.