South Asia: Imported ferrous scrap offers rise up to $3/t as sellers adopt firm stance

South Asian ferrous scrap prices experienced a slight uptick due to a firm stand taken by sellers, although buying activities remained minimal in India, Pakistan, and Bangladesh. In India, buyers continued to exhibit reluctance in committing to volumes, citing price disparities and the availability of better alternatives in the domestic market. Meanwhile, purchases of imported scrap slowed down in Pakistan and Bangladesh due to Ramadan holidays and ongoing LC availability issues.

In contrast, the Turkish imported ferrous scrap market witnessed an upward trend as mills sought to restock ahead of the Ramadan holidays.

Shredded scrap offers increased by $3/t in India, $2/t in Pakistan, and $1/t in Bangladesh. Bulk HMS (80:20) offers from the US to Turkiye rose by $4/t compared to the previous closing on Friday.

Overview

Today, India's market for imported ferrous scrap remained subdued, mainly due to the recent holidays. Limited activity was observed and there was notable resistance among buyers towards imported scrap, particularly shredded from Europe, largely due to perceived unviability of offered prices. Prices have witnessed an uptick reflecting higher collection costs and following a recent surge in the Turkish market. Current offers for shredded scrap from Europe are in the range of $412-415/t CFR, while offers for HMS (80:20) from West Africa and Europe are at $375-385/t CFR.

In Pakistan and Bangladesh, purchasing activities remained sluggish due to ongoing Ramadan celebrations and a decrease in domestic demand for finished steel. Additionally, Bangladesh faced renewed challenges with LC (Letter of Credit) issuances, hindering buyers from securing imported scrap. Shredded scrap offers into Pakistan from Europe were at $415-420/t CFR Qasim, while offers from the UAE were around $425-430/t CFR. For HMS (80:20), offers were heard at $405-410/t CFR.

In Bangladesh, offers for shredded scrap were in the range of $410-415/t CFR Chattogram, while HMS (80:20) was priced at $395-400/t CFR.

A Turkish mill based in the Aegean region secured a Netherlands-origin cargo including 22,000 t of HMS (80:20) at $385.5/t and 8,000 t of bonus scrap at $405.5/t CFR Turkiye for early-May shipment. Today, an East Marmara-based mill purchased a Europe-origin cargo with HMS (80:20) at $385/t CFR Turkiye. A US-origin scrap deal was heard concluded for another Aegean region-based mill at $389/t (HMS (80:20) and $409/t (shredded and bonus) on a CFR Turkiye basis.

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $415/t CFR Nhava Sheva, up by $3/t compared to the last closing on 23 Mar'24.

Pakistan: UK-origin shredded scrap indicatives were assessed at $418/t CFR Qasim, up by $2/t.

Bangladesh: UK-origin shredded scrap prices were assessed at $412/t CFR Chattogram, up by $1/t.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $390/t CFR Turkiye, up by $4/t.

Outlook

In the near term, it is expected that imported ferrous scrap offers will continue to remain elevated, primarily due to increased collection costs and following the bridge collapse in Baltimore. This incident has significant implications, as Baltimore is a crucial port for certain grades of US scrap exports. Furthermore, the largest scrap importer, Turkiye, has been restocking ahead of the Ramadan holidays which is expected to influence pricing dynamics in other markets as well.