South Asia: Imported ferrous scrap prices continue downtrend amid weaker sentiments

The South Asian ferrous scrap market experienced a decline today. In India, with the holiday mood prevailing and an unclear price trend, buyers opted to stay on the sidelines. In Pakistan, there were no significant activities due to a subdued finished steel sector. In Bangladesh, challenges related to LC (Letter of Credit) have been impacting imported deals.

Offers for shredded scrap in India decreased by $5/tonne (t), while in Pakistan and Bangladesh, they saw a slight reduction of $1/t compared to the closing prices from the previous Friday.

Market overview

India: In India today, the demand for imported scrap remained subdued due to the observance of the Ram Navami and Dussehra festivals, as well as a lack of buyer confidence in the current price trend. Shredded scrap from Europe was offered at $395/t CFR at Nhava Sheva. However, buyers were aiming for pricing levels in the range of $385-390/t CFR.

HMS (80:20) scrap from Europe was assessed at $375/t CFR Nhava Sheva, while bids were below these levels.

A trader source said, "The market currently appears uncertain because buyers are uncertain about the price bottom. However, there is an expectation that the market will improve after the Dussehra week. Moreover, the availability of imported scrap is stable, and there have been no reports of aggressive buying in the market."

Pakistan: Today, the demand for imported scrap in Pakistan remained lackluster, primarily as a result of weak demand for finished steel in the domestic market. Offers for shredded scrap from Europe were heard at $395-400/t CFR Qasim.

Within the domestic market, local scrap is being traded at PKR 130,000-135,000/t (cash), while rebars hovered at PKR 240,000-245,000/t and billets were at PKR 210,000/t.

Bangladesh: In Bangladesh, the demand for imported ferrous scrap is being adversely affected by several factors, including difficulties in opening letters of credit and sluggish construction demand, which can be attributed to the upcoming elections.

Shredded scrap originating from Europe were heard being offered at $415/t CFR Chattogram, while HMS (80:20) were assessed at $395-400/t CFR.

In the domestic market, billet prices stood at BDT 78,000-79,000/t ex-Chattogram, rebars were heard at BDT 88,000/t ex-Dhaka and BDT 95,000/t ex-Chattogram. Local scrap prices were assessed at BDT 60,000/t ex-Chattogram.

Turkiye: Steel producers in Turkiye have re-entered the deep-sea scrap import market for November shipments, capitalising on recent price declines. Market reports indicate deals in the range of $345/t to $348/t from Europe, while tradable prices from the US hover between $352/t and $355/t CFR in the current market context.

Steel manufacturers are grappling with reduced steel sales and declining prices for both semi-finished and finished products. Meanwhile, suppliers are adjusting their offers downwards as they observe a downward trend in finished steel prices.

Recent deals

• Around 500 t of PNS scraps were sourced from Malaysia at $438/t CFR Chattogram.
  
  
• A 500-t mix parcel of HMS and PNS scrap from Peru's Callao port were booked at $430/t CFR Chattogram.
  
  

Price assessments

India: UK-origin shredded scrap offers were assessed at $395/t CFR Nhava Sheva, down by $5/t from the last closing on Friday.

Pakistan: UK-origin shredded scrap offers were down by $1/t to $400/t CFR Qasim today.

Bangladesh: Offers for UK-origin shredded scrap were assessed at $415/t CFR Chattogram, down by $1/t today.

Turkiye: US-origin HMS 1&2 (80:20) prices were assessed at $354/t CFR Turkiye, down by $1/t from last closing.

Outlook

The outlook of the ferrous scrap market is currently uncertain due to Indian buyers adopting a cautious approach in light of ongoing decreases in offers. Additionally, the largest scrap consumer, Turkiye, is displaying a pessimistic outlook. Consequently, buyers are expecting a modest market correction. In Pakistan, sluggish demand for finished steel is affecting scrap consumption, leading buyers to defer their new purchases. In Bangladesh, issues related to LC (Letter of Credit) are expected to persist until the upcoming elections.