South Asia: Imported ferrous scrap offers downtrend in slow trade

The South Asian ferrous scrap market saw a predominantly downward trend. Indian buyers remained inactive due to price differences, while Pakistani slowed down ahead of the elections on 8 February. Bangladeshi buyers were relatively active, although today's pace was slower.

Shredded scrap offers decreased by $1-4/tonne (t) in India and Pakistan, while rising by $1/t in Bangladesh. US bulk HMS (80:20) offers to Turkiye also declined by $3/t d-o-d.

Market overview

India: In India, demand for imported scrap remained low due to unfavourable pricing. Shredded scrap from Europe was offered at $410-415/t CFR Nhava Sheva, while HMS (80:20) was priced at $390-400/t CFR. In Chennai, shredded scrap was quoted at $410/t CFR, and HMS (80:20) at $380-390/t CFR.

Comparing domestic and imported scrap prices, HMS (80:20) was priced at INR 32,500/t DAP Jalna, while imported HMS (80:20) was at $396/t CFR Nhava Sheva, equivalent to INR 35,000-36,000/t, including freight and other charges. This resulted in a gap of approximately INR 2,500-3,500/t ($30-42/t), making imports economically unviable at present.

Pakistan: Market activities in Pakistan remained sluggish, leading up to the elections on 8 February. Indicative offers for shredded scrap from Europe were noted at $435-445/t CFR Qasim.

A steel mill official mentioned, "Pakistani buyers are now focusing on the EU/UK market due to import restrictions and substantial export duties imposed by the UAE. Post-election bookings are expected to possibly resume from Europe."

A representative from a trading company commented, "With elections scheduled for tomorrow, there's currently a lack of interest in engaging in new business."

Offers from the UAE were reported at $450-455/t CFR for shredded scrap and $415-420/t CFR for HMS (80:20).

Bangladesh: In Bangladesh, purchasing activities stayed moderate, with offers for shredded scrap from Europe hovering around $430-435/t CFR Chattogram, and HMS (80:20) at $410-415/t CFR.

A trader noted, "Market activities have picked up due to enhanced domestic steel market sentiments and a relaxation in LC approvals."

Turkiye: Turkish deep-sea imported ferrous scrap prices decreased following the conclusion of a recent deal amidst a weakened euro. Offers for HMS (80:20) were evaluated at $419/t CFR. A steel mill in the Aegean region secured a Danish-origin shipment of HMS (85:15) at $421/t for mid-March delivery on CFR Turkiye basis.

Other recyclers in the Baltic region hesitated due to elevated freight rates and rising collection costs, impeding exports to Turkiye. Some opted to wait until prices reached $430/t CFR before selling. While the euro's decline offered some relief, market stability remained uncertain. The near-term sentiment was bearish as sluggish steel sales in Turkiye, affecting deal activity. The limited availability of HMS in Europe compounded challenges, exacerbated by the weaker euro. Turkish mills encountered difficulties in selling rebar domestically, influencing scrap purchases.

Recent deals

Around 1,000 t CR of busheling scraps were booked from Germany at $410/t CFR west coast India.

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $412/t CFR Nhava Sheva, down by $4/t d-o-d.

Pakistan: UK-origin shredded scrap indicatives were assessed at $441/t CFR Qasim, down by $1/t d-o-d.

Bangladesh: UK-origin shredded scrap prices were assessed at $434/t CFR Chattogram, up by $1/t d-o-d.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $419/t CFR Turkiye, down by $3/t d-o-d.

Outlook

The imported scrap market is expected to remain sluggish due to lacklustre activity in India and Pakistan. Turkish mills are also encountering difficulties in selling finished steel products. However, Bangladeshi buyers are displaying active interest. Taking these factors into account, pressure is expected in the near term for markets other than Bangladesh.