South Asia: Imported ferrous scrap offers drop further, Pakistani buyers remain active

The South Asian ferrous scrap market further softened today. In India, sluggishness prevailed as the imported ferrous scrap market grappled with a substantial disparity between domestic and imported prices. Buyers remained cautious, awaiting offers in alignment with their preferences and anticipating a boost in domestic steel market sentiment. Conversely, Pakistan saw decreased imported scrap offers amidst buyer pressure, while Bangladesh and Turkiye maintained moderate and declining price trends, respectively.

Overview

The imported ferrous scrap market in India continued to experience sluggishness due to a significant gap between domestic prices and landed imports. Many buyers are waiting to make purchases only if offers align with their desired levels and if sentiment improves in the domestic steel market. Offers for shredded scrap from Europe/UK and the US were reportedly around $400-410/t CFR, while HMS (80:20) offers from Europe/UK and West Africa were in the range of $370-380/t CFR. Chile HMS 1 offers were heard to be around $390/t CFR.

A representative from a trading company commented, "The market is currently silent for a short period. We expect buying to improve by the end of March. There is almost a $20 gap between domestic and imported scrap prices. There's no point in offering."

In Pakistan, imported scrap offers have decreased due to buyer pressure, resulting in the completion of a few deals. Shredded scrap offers from the UK/Europe were reported at $405-406/t CFR Qasim. Meanwhile, domestic market activities remained sluggish due to preparations for the upcoming Ramzan. Local scrap prices were observed at PKR 160,000-165,000/t, while rebars were assessed at PKR 260,000-265,000/t.

A representative from a steel mill stated, "The local market is slow as the coil market has declined, and rebar sales are also sluggish. Moreover, with Ramzan commencing on Monday, buyers are not expected to make aggressive bookings."

Moreover, in the Bangladesh market, activities remained moderate, with shredded scrap offers at $415/t from the UK/Europe, followed by HMS (80:20) at $400-405/t CFR.

Imported ferrous scrap prices in Turkiye experienced a significant drop during the week. Deals for late-March to April shipments from Europe and the US closed at lower prices, with HMS (80:20) fetching around $376-380/t from the US and $368-381/t CFR from the UK/Europe. Shredded and bonus scrap from the US were priced at approximately $396-398/t.

Recent deals

Around 1,000 t of shredded scrap was booked at around $406/t CFR Qasim from the UK to Pakistan.

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $403/t CFR Nhava Sheva, down by $3/t d-o-d.

Pakistan: UK-origin shredded scrap indicatives were assessed at $405/t CFR Qasim, down by $5/t d-o-d.

Bangladesh: UK-origin shredded scrap prices were assessed at $415/t CFR Chattogram, down by $3/t d-o-d.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $374/t CFR Turkiye, down by $2/t d-o-d.

Outlook

Imported ferrous scrap offers are expected to remain volatile, especially in South Asian markets. Nevertheless, there might be a slight upward trend in Turkish prices due to resistance from sellers against further drops in offers, whether Turkish mills accept this hike or not depends on their domestic rebar market.