South Asia: Imported ferrous scrap offers inch down by $2/t amid weak sentiments

The South Asian ferrous scrap market continues to remain slow due to bearish sentiments. In India, the subdued steel sector is affecting scrap consumption. In Pakistan, price uncertainties and exchange rate fluctuations are making buyers hesitant. In Bangladesh, market activities continue to be affected by LC delays. Shredded scrap prices corrected slightly in India, Pakistan, and Bangladesh, while HMS bulk offers in Turkiye remained stable.

Shredded prices saw corrections of $1-2/tonne (t) in India, Pakistan, and Bangladesh.

Market overview

India: Today, the demand for imported scrap in India remained weak due to a lack of buying interest, reflecting the sluggishness in the domestic steel market.

Offers for shredded from Europe were assessed at $400-405/t CFR Nhava Sheva, while buyers' bids were reported at $395-400/t CFR levels and below. HMS (80:20) scrap from Europe was offered at $388-392/t CFR Nhava Sheva.

An official with a steel mill located in southern India said, "Market sentiments are not favourable at the moment. We are refraining from making purchases because we currently have substantial steel inventories in hand."

A trade source shared a similar sentiment, stating, "The prevailing market conditions are indeed challenging, and we find it difficult to generate any profits. This situation has led us to adopt a vigilant and observant strategy. Notably, sellers, especially those at the yard, are reluctant to reduce their prices."

Another trade source said, "Buyers have indicated their interest in shredded scrap today at approximately $395-400/t, while bids for HMS (80:20) were heard at around $380-385/t CFR Mundra. However, it seems challenging for sellers to align their offers with these levels."

Pakistan: In Pakistan, the demand for imported scrap was sluggish today, with no significant deals reported. Offers for shredded from Europe were in the range of $405-410/t CFR Qasim, but buyers' bids were noted to be below these levels.

Bangladesh: In Bangladesh, the demand for imported scrap remains limited, mainly due to challenges faced by buyers in opening letters of credit (LCs). Offers for shredded from Europe were noted in the range of $415-420/t CFR Chattogram. Indicative prices for HMS (80:20) from Europe were at around $400/t CFR, and from Australia, between $405-410/t CFR.

A trade source explained, "Given the ongoing difficulties in obtaining LCs, buyers are currently showing a preference for bulk shipments over container deals. We have a substantial pending LC order of over 20,000 t. So, for the time being, we are not engaging in such transactions."

Turkiye: Market participants reported a lack of activity today as Turkish mills exercised caution in fulfilling their November shipment requirements. Recyclers from various origins showed no rush to sell. A US-based seller said, "We do not anticipate significant price changes. Turkiye will struggle to push prices down."

The market remained stagnant, with Turkiye having already restocked from Romania and Bulgaria in the shortsea market, and there being limited demand from Europe. An indicative workable price for US/Baltic-origin HMS (80:20) was at around $359-$360/t CFR. The short-term price sentiment was mixed, with potential for price action seen as limited in either direction due to the current standstill scenario.

Major scrap suppliers feel Turkish prices may correct further as rebar offers have witnessed a drop of around $5-10/t w-o-w. Hence, this development could prompt a downward shift in other South Asian countries too.

Recent deals

• Around 1,000 t of PNS scrap from Hong Kong were procured at $440/t CFR Chattogram.
  
  
• Around 1,000 t of Malaysian PNS scrap booked at $440/t on a CFR Chattogram basis.
  
  
• About 500 t of HMS (80:20) scrap from Venezuela were booked $400/t CFR west coast India.
  
  
• Approximately 1,000 t of Libya-origin HMS (80:20) scrap were booked at $397/t CFR west coast, India.
  
  
• A small parcel of 250-t of HMS (80:20) from South America was sealed $400/t CFR west coast, India.
  
  
• Approximately, 250 t of Mozambique-origin HMS (80:20) were concluded at $395/t CFR west coast, India
  
  
• Around 1,000 t of HMS (80:20) scrap from Australia were booked at $398/t CFR Chattogram.
  
  

Price assessments

India: UK-origin shredded scrap offers were at $402/t CFR Nhava Sheva, down by $2/t d-o-d.

Pakistan: UK-origin shredded scrap offers were assessed at $404/t CFR Qasim, down by $1/t today.

Bangladesh: Offers for UK-origin shredded scrap were down by $2/t to $418/t CFR Chattogram today.

Turkiye: US-origin HMS 1&2 (80:20) prices were stable at $360/t CFR Turkiye.

Outlook

The South Asian ferrous scrap market faces downward pressure due to stagnation in Turkiye, which often sets benchmark prices. Some mills in Turkiye have even lowered rebar prices within the domestic market. Its current situation is likely to influence other markets as well. This overall negative outlook is compounded by weak demand and the struggling finished steel sector in the region.