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

South Asian ferrous scrap prices declined today. In India, the presence of cost-effective alternatives and the arrival of previously booked materials led to a lack of buying interest. Meanwhile, subdued finished steel sales in Pakistan resulted in moderate activity. In Bangladesh, challenges in opening Letters of Credit (LC) and the upcoming elections contributed to slow market sentiments. Turkish mills, having already made sufficient bookings, showed a low appetite for imported scrap.

Shredded scrap offers witnessed a d-o-d drop of $5-6/t in India, Pakistan, and Bangladesh. Similarly, US bulk HMS (80:20) offers to Turkiye decreased by $2/t.

Market overview

India: In India, the demand for imported scrap, particularly shredded, has been subdued, primarily due to pricing challenges. Additionally, numerous mills are still maintaining sufficient inventory, expected to last until December to mid-January. Consequently, there have been no reports of fresh bookings for shredded scrap. Indicative offers for shredded scrap from the US and Europe were heard at $420-425/t CFR Nhava Sheva, while bids were heard lower at $410-415/t CFR.

HMS (80:20) offers from the UK and West Africa were heard at $400-410/t CFR Nhava Sheva.

A trader said, "The Indian market is currently quiet, with mills holding stocks until December and mid-January. The material which was previously booked is now arriving, and people are primarily focused on utilising these existing bookings as these were made at much lower prices compared to current levels. Hence, buying interest is subdued at the moment."

A few bulk inquiries were heard from the US and Australia, but are yet to be confirmed, and the shipments are likely scheduled for the end of January or early February.

Pakistan: Today in Pakistan, the demand for imported scrap remained moderate, coinciding with a subdued performance in the domestic finished steel market. Furthermore, only a limited number of European suppliers were active, likely influenced by more favourable realisations in other markets and the approaching winter holidays. Indicative offers for shredded scrap from Europe and the Middle East were reported at $433-435/t.

In the domestic market, grade 60 rebar prices were at PKR 260,000-262,000/t exw.

Bangladesh: In Bangladesh, demand for imported scrap has been relatively subdued, with buyers encountering difficulties in opening LCs. Also, concerns about potential change of power in the upcoming elections scheduled for 7 January have led to a decline in finished steel sales, contributing to reduced consumption of scrap.

Indicative offers for shredded scrap from Europe were reported at $445/t CFR Chattogram, while offers for HMS (80:20) were at $426/t CFR.

Turkiye: Trading activity in Turkiye's imported scrap market ground to a halt, as participants assessed the situation following a sharp price hike. Turkish mills, having secured necessary volumes, were not rushing into new deals. Scrap collectors are firm and not offering discounts. With no fresh contracts, market sources agreed that the bulk of January shipment scrap for Turkish steelmakers have already been booked.

Recent deals

• Around 650 t of shredded scraps were booked from Europe at $425/t CFR Qasim.
  
  
• A parcel of 500-t of PNS scraps were sourced from Mauritius at $410/t CFR Mundra and is expected to arrive in January.
  
  
• About 1,000 t of bonus scraps were booked from the USA (in a vessel) at $415/t CFR Kandla, expected to arrive in early January.
  
  
• Approximately 250 t of shredded scraps were booked from the UK at $433/t CFR Qasim.
  
  
• Around 500 t of HMS (80:20) scrap were booked from West Africa at $403/t CFR west coast India.
  
  
• About 500 t of CR busheling scraps were secured from Germany at $440/t CFR west coast India.
  
  

Price assessments

India: The UK-origin shredded scrap indicatives inched down by $6/t to $424/t CFR Nhava Sheva today.

Pakistan: The UK-origin shredded scrap indicatives were down by $1/t to $435/t CFR Qasim today.

Bangladesh: The UK-origin shredded scrap prices were assessed at $445/t CFR Chattogram, down by $5/t d-o-d.

Turkiye: The US-origin HMS (80:20) bulk prices were assessed at $425/t CFR Turkiye, down by $2/t d-o-d.

Outlook

The outlook for imported ferrous scrap offers appears to be volatile, given the current situation. Suppliers are holding firm, but buyers, particularly in India, are hesitant to entertain higher offers due to the availability of cost-effective alternatives in the domestic market. Furthermore, the lack of active interest from Turkish mills, which are already stocked up, could contribute to a softening of offers.