South Asia: Imported ferrous scrap prices remain stable amid cautious buying, uncertain outlook

The South Asian imported ferrous scrap market remained largely stable on a d-o-d basis. Trading activities in India were quiet as major participants continued their holiday break. In Pakistan, weak finished steel demand and sluggish rebar sales made the scrap market slow. Bangladesh's scrap market was characterised by a mismatch between sellers' high asking prices and buyers' cautious approach. Meanwhile, Turkish mills anticipated upward scrap price movements, citing reduced supply from the US and Europe.

India: Today in India, trading activities stayed quiet as major participants continued their holiday mode, expecting more activity next week.

UK-origin shredded scraps were offered at $416-420/t, with a workable range of $410-414/t.

Bids for the US-origin shredded scraps were at around $406-410/t, with sellers showing hesitancy at these levels.

Europe-origin HMS (80:20) scrap indicatives heard between $400-405/t.

HMS (90:10) scraps from Australia were offered at $408-412/t CFR Nhava Sheva and CFR Chennai.

West African HMS (80:20) is being offered at $390-400/t CFR, depending upon container size.

Limited availability of containers and materials for export has led the UK and the US sellers to anticipate higher pricing. The US and European scrap yards prioritise fulfilling the demand for bulk cargoes for Turkish mills.

In the domestic market, trading activities were limited due to the inactivity of major participants amid ongoing elections in Chhattisgarh, Madhya Pradesh, and Rajasthan. The domestic scrap market, especially in north India, faced scarcity, impacting smaller mills with high material prices and a wider spread between scrap and ingot prices.

Pakistan: The current price level is around $415-418/t for Europe-origin containerised shredded scrap, but sellers are expecting better demand before the winter holidays and are holding out for higher prices. The domestic scrap market is also weak, with prices at around PKR 155,000-160,000/t. Billet prices are also under pressure, with prices hovering at PKR 228,000-230,000/t. Rebar prices are at around PKR 260,000/t exw.

A trader informed, "Finished steel sales have dropped, which is putting pressure on the steel market. Banks are not making payments, and sales have slowed down. Offers for imported ferrous scrap have been heard in the range of $415-420/t in the last couple of days."

Bangladesh: In the Bangladesh ferrous scrap market, sellers' high asking prices, driven by limited availability and global competition, contrast with buyers' interests. As the industry approaches the second week of December, yards are preparing to close operations for the Christmas and New Year holidays, known as the winter break.

The UK yards suggest offers ranging from $432 to $435/t, nearing $440/t, considering global demand. LC-related challenges persist but have slightly eased. Offers for busheling and PNS from Hong Kong and Malaysia are at $435-$445/t, capitalizing on shorter delivery periods.

Containerised HMS (80:20) has surged to $410/t, while HMS 1 from Australia is at $416-420/t CFR Chattogram.

According to a trader, significant challenges in opening LCs persist for both smaller and larger mills. The process sometimes takes up to three weeks or more, creating substantial issues for sellers and yards in fulfilling contracts.

Turkiye: Some Turkish mills anticipate upward scrap price movement, driven by reduced supply in the US and Europe. Unconfirmed indications at $385-390/t CFR Turkiye hint at potential increases. Sluggish product sales prompt Turkish steelmakers to maintain low inventories, contributing to the surge. Domestic scrap prices also rose, with increases of TRY 100 to 500/t from the last couple of days. While Turkish steel companies believe the import price uptrend may be limited, they foresee sustained domestic scrap price hikes due to rising demand. An official from a Turkish steel company suggests that the upward trend in domestic scrap prices is likely to persist as steelmakers prefer local supply amid increasing import prices. The last reported imported scrap deal from the US was heard to be at $383/t to an Aegean region-based mill.

Price assessments

India: UK-origin shredded scrap indicatives stable $416/t CFR Nhava Sheva today.

Pakistan: UK-origin shredded scrap indicatives remain unchanged at $416/t CFR Qasim today.

Bangladesh: UK-origin shredded scrap is stable at $428/t CFR Chattogram today.

Turkiye: US-origin HMS 1&2 (80:20) prices stood at $385/t CFR Turkiye, up by $1/t d-o-d today.

Outlook: Trading activities in India are expected to pick up next week as major participants return from their holiday break. The outlook for the Pakistani-imported ferrous scrap market is uncertain. However, weak demand for finished steel products in Pakistan could put downward pressure on prices. The upcoming holiday season may bring some volatility in the Bangladesh market, but overall, the market is expected to remain range-bound.