South Asia: Imported ferrous scrap prices drop d-o-d, Stable in Pakistan

The South Asian ferrous scrap market witnessed prices edging lower, especially in India. Shredded scrap offers dropped around $5-6/t, while shredded offers in Pakistan remained largely stable. On the other hand, Bangladesh witnessed a marginal fall in shredded and HMS (80:20) offers amid weaker demand. The Turkiye market was under pressure due to lower rebar sales in the domestic and overseas markets and dock prices have been going down recently due to weaker demand from end-users.

Market overview

India:Today, in the Indian imported ferrous scrap market, suppliers were holding prices steady, while buyers were offering lower bids. Shredded scrap bids were at around $405/t, while offers ranged from $408-412/t. Bids for shredded scrap from the US were also at $402-405/t, yet offers heard today were at $415/t. HMS (80:20) from Australia and Poland was priced at $395-400/t.

The reasons behind the decline in prices were the impact of war in West Asia, a downward trend in the Turkish market, limited demand, and tight money market conditions.

A trader source informed, "An offer from the US, proposing shredded scrap at $415/t CFR, has been declined by Indian steel mills, as buyers are expecting a further decrease in prices."

As per a mill representative, "There is reduced demand for sponge iron (DRI) in the eastern region, impacted by sluggish rebar /construction sector. Although some positive correction is expected next week, it may not follow the typical yearly trend."

Pakistan:The imported ferrous scrap market in Pakistan continued to remain weak. Offers for shredded scrap from Europe hovered around $408-410/t. A Seller side representative informed, "We offered at $410-415/t till yesterday, today it should go down as PKR is strong now. Buyers might hold at these levels. Earlier, deals were done at below $410/t levels. There is the possibility that workable levels may remain low."

Bangladesh: The imported ferrous scrap market in Bangladesh was weak as there were no significant deals heard. Offers for EU/UK origin shredded scrap were heard at $420-422/t and HMS(80:20) indicatives at $402-405/t CFR Chattogram, while HMS (80:20) from Australia was offered at $418-420/t CFR.

Turkiye: Market participants observed significant bid-offer spreads as Turkish mills aimed to lower prices amid uncertainties linked to the Middle East conflict, but sellers resisted. Tradable values for US-origin or premium HMS(80:20) primarily ranged from $360-$362/t CFR, with sellers targeting $367-$368/t CFR. Shortsea sellers in Romania urgently sought cash, resulting in deals as low as $335/t.

According to sources, dock prices have consistently declined in recent weeks, from a peak of $300-$305 to $295-$300/t, now at around $290/t. Turkish mills remained watchful due to a 30% surge in EU LNG prices to Euro 53/MWh, the highest since March 2023, driven by supply concerns due to the conflict in the Middle East.

Recent Deal:

• Around 500 t Germany origin Turning scrap sold at $380/t on a CFR Chennai basis
  
  
• Around 3,500 t Romania origin HMS(80:20) bulk deal concluded at $335/t (shortsea) CFR Turkiye
  
  

Price assessments

India: UK-origin shredded scrap offers were at $408-410/t CFR Nhava Sheva, down by $6/t d-o-d.

Pakistan: UK-origin shredded scrap offers were largely stable at $410/t CFR Qasim today.

Bangladesh: Offers for UK-origin shredded scrap were down by $3/t d-o-d at $422/t CFR Chattogram.

Turkiye: US-origin HMS 1&2 (80:20) prices were down by $2/t to $361/t CFR Turkiye.

Outlook

The imported ferrous scrap market in South Asia is expected to see some correction in prices, as the Indian imported scrap market is expected to witness an uptick in prices ahead of the festive season. Meanwhile, Pakistan is expected to align with global trends, with prices remaining range-bound. In Bangladesh, the market may remain steady with an apparent lack of urgency in bookings due to LC issues.