South Asia: Imported scrap market under pressure but active Turkish buying may support prices

The South Asian ferrous scrap market faced a slew of challenges today. In India, demand remained sluggish due to domestic market volatility, causing cautious procurement and ongoing bid-offer disparities. Pakistani buyers were also slow due to a post-Eid slowdown and fund shortage, though prices are expected to rise as Turkiye re-enters the market. In Bangladesh, uncertain freight rates and difficulties in opening Letters of Credit have led to a wait-and-watch approach amidst bearish steel demand. Meanwhile, Turkiye has seen multiple deals pushing scrap prices up, but softening rebar prices and increased freight costs temper the outlook of a strong recovery.

Overview

India: In India, the demand for imported scrap remains sluggish due to volatility in the domestic market, causing buyers to be cautious in procuring imported scrap. Additionally, there is still a persistent bid-offer disparity, with buyers aiming to procure at $5-10/t less than offered prices, leading to intense negotiations and very few concluded deals. Indicative offers for shredded scrap from the US and the UK/Europe were heard at $410-412/t CFR Nhava Sheva, while buyers' bids were at $405-408/t CFR. Offers for HMS (80:20) from West Africa and the UK/Europe heard at $385-390/t CFR.

A trader source commented, "Here in the northern region, buyers are asking at least $10/t below prevailing offers. The domestic market is down and due to delayed shipments customers are receiving old cargoes purchased earlier, plus sponge iron is also cheaper."

Pakistan: Pakistan was muted today due to a slowdown in the domestic steel market, which has not fully resumed post-Eid. Normalcy is expected to return next Monday, but overall industry production is still at 30-40%. There is pressure in the market as sales are not active due to fund shortage.

Current UK/Europe offers for shredded scrap hover at $420-422/t CFR Qasim.

A market participant commented, "I think the market will go up next week in Pakistan, as Turkiye is also back in the fray."

Bangladesh: The Bangladeshi imported scrap market remained in a wait-and-watch mode today due to bearish steel demand. Participants dealing with containerised scrap are experiencing uncertain freight rates and a negotiable price range varying from $395-410/t for HMS from the US and Australia.

A bulk deal for Bangladesh from the US was heard but is yet to be confirmed. Buyers are also facing challenges in opening Letters of Credit (LCs), adding to the market's uncertainty.

Globally, the market is expecting a quiet week with nominal bookings. Some suppliers are warning of declining scrap flow issues during the summer, while others anticipate a temporary rebound as Turkish scrap bookings have resumed in bulk, which will support prices temporarily.

Turkiye: The Turkish imported ferrous scrap market saw multiple deals from the US and Europe, pushing prices up as mills returned after a quiet holiday week.

Recent transactions include:

• Baltic supplier to Mediterranean mill: HMS (80:20) at $388.5/t CFR Turkiye.
  
  
• Northern European supplier to Aegean mill: HMS (80:20) at $387.5/t CFR Turkiye.
  
  
• US supplier to Aegean mill: HMS (80:20) at $389/t CFR Turkiye.
  
  
• Two UK-origin HMS (80:20) bulk scrap cargoes at $385/t CFR Turkiye.
  
  
• One Holland-based HMS (80:20) cargo at $384/t CFR Turkiye.
  
  

Deepsea suppliers are pushing for higher prices due to increased freight costs. However, Turkish rebar prices are softening amid weak demand, dampening hopes for a stronger recovery in scrap prices.

Price assessments

India: UK-origin shredded scrap indicatives edged down by $2/t to $413/t CFR Nhava Sheva, d-o-d.

Pakistan: UK-origin shredded indicatives were assessed at $422/t CFR Qasim, up by $1/t d-o-d.

Bangladesh: UK-origin shredded prices were assessed at $423/t CFR Chattogram, down by $1/t d-o-d.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $390/t CFR Turkiye, up by $1/t d-o-d.