South Asia: Imported ferrous scrap offers edge down amid lack of buying interest

The South Asian ferrous scrap market witnessed a decline today, mainly driven by a lack of buying interest in various markets. In India, the unattractive pricing made imports unfeasible for buyers.

In Pakistan, cautious behavior was observed ahead of the upcoming elections next week. Bangladesh reported no significant activities. Shredded scrap offers dropped by $5/t in India, while they remained unchanged in Pakistan and Bangladesh compared to the previous Friday's closing prices.

Market overview

India: The demand for imported scrap in India remained subdued, primarily due to the impracticality resulting from the disparity between domestic and imported scrap prices. Indicative offers for shredded scrap from Europe were assessed at $405-410/t CFR Nhava Sheva, while HMS (80:20) was noted at $390-395/t CFR.

A trader emphasized that "The import of scrap is presently unfeasible, given the significant surplus of steel stocks in the market. This surplus has resulted in a lack of interest in seeking offers, and project-based purchases are progressing at a slow pace. As of the latest update, shredded steel was priced at $400-405/t, and HMS scraps fell within the range of $385-390/t."

According to another trader, "There is currently a lack of enthusiasm from buyers to acquire any materials in India. The predominant activity is confined to distress selling."

Pakistan: In Pakistan, the demand for imported scrap continued to be slow today following the anticipation of national elections on 8 February. Indicative offers for shredded scrap from Europe were assessed at $435-440/t CFR Qasim, while offers from the Middle East were heard at $455-460/t CFR.

Within the domestic market, sales of domestic rebar maintained a moderate pace, with prices ranging from PKR 255,000-260,000/t. Local scrap prices were evaluated at PKR 160,000-165,000/t, and billets were priced at PKR 225,000-230,000/t exw.

An official from a steel mill commented, "Market activities have remained slow due to the upcoming election next week. However, our purchase of imported scrap is proceeding at a slower pace due to increased lead times as we anticipate the need for materials in the upcoming production cycle."

Bangladesh: As per market participants, the imported market in Bangladesh remained sluggish, with customers adopting a wait-and-watch approach. Customers anticipate this condition to persist for another month as they work to liquidate their high stocks and inventories.

The indicative offers for shredded scrap from Europe were assessed at $440-445/t CFR Chattogram, while HMS (80:20) scraps were at $415-420/t CFR.

Recent deals

• About 500 t of HMS (80:20) scraps were booked from the Middle East at $409/t CFR Qasim.
  
  
• Around 500 t of HMS (80:20) were booked from Central America at $395/t CFR Nhava Sheva.
  
  
• A parcel of 1,000-t of HMS (80:20) scraps were booked from Australia at $384/t CFR Thailand.
  
  
• Approximately 2000 t of shredded scraps were procured from Australia at $400/t CFR Thailand.
  
  

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $410/t CFR Nhava Sheva, down by $5/t compared to the last closing on Friday.

Pakistan: UK-origin shredded scrap indicatives were assessed at stable at $440/t CFR Qasim, compared to the last closing on Friday.

Bangladesh: UK-origin shredded scrap prices were assessed unchanged at $440/t CFR Chattogram, compared to the last closing on Friday.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $420/t CFR Turkiye, stable compared to the last closing.

Outlook

Anticipated fluctuations in imported scrap offers are expected in South Asian countries due to prevailing market conditions. Furthermore, in India, the budget announcement on 1 February, following the central elections in March and April, is likely to lead to constrained cash flow. In Pakistan, approaching elections next week suggest that clear market conditions are expected to emerge post-elections