South Asia: Imported scrap offers decline amid sluggish buying inquiries

Ferrous scrap offers in South Asia witnessed a decline attributed to subdued demand across different markets. In India, buyers showed reluctance to secure imported scrap, citing a price differential and the presence of economical stocks in the domestic market. The Pakistani market displayed sluggishness, impacted by sluggish sales of finished steel amid political unrest. In Bangladesh, buyers grappled with challenges related to letter of credit (LC) availability and a slowdown in the finished sector due to upcoming elections.

Shredded scrap offers witnessed a decline of $2-4/t in India, Pakistan, and Bangladesh.

Market overview

India: In India, the demand for imported scrap continued to remain subdued, primarily influenced by the price gap and the presence of previously booked materials. There were indicative offers for shredded scrap from Europe at approximately $420/t CFR Nhava Sheva, and HMS (80:20) at $398-402/t CFR. Additionally, HMS (80:20) offers from West Africa were reported at $390-395/t CFR.

A trader commented, stating, "Market sentiments in India are currently unfavourable. No transactions are occurring at the moment. Indian buyers are inclined to make significant purchases only when the material is available within the $400/t CFR Nhava Sheva or Mundra."

Pakistan: In Pakistan, the procurement of imported scrap has encountered a slowdown, primarily due to subdued sentiments prevailing in the domestic market. This deceleration was further intensified by the political unrest leading ahead of the February elections, resulting in a decline in finished steel sales. Furthermore, sellers are exclusively opting for cash transactions due to year-end closing, thereby exerting an impact on overall trade volumes.

Imported shredded scrap offers from Europe were reported at $427-430/t CFR Qasim, while those from the Middle East ranged from $430-436/t CFR.

In the local market, domestic scrap prices were noted at PKR 160,000-165,000/t, with rebars observed at PKR 267,000-270,000/t exw.

Bangladesh: In Bangladesh, the demand for imported scrap sustained a sluggish pace today, primarily attributed to a current slowdown in the finished steel market, which is influenced by the upcoming elections in January. Shredded scrap offers from Europe were evaluated in the range of $430-436/t CFR Chattogram, while HMS (80:20) was reported at $420-425/t CFR.

Turkiye: In the Turkish imported scrap market inconsistent demand and no notable improvement in scrap inquiries were witnessed at the start of the week as buy-side sources expressed apprehension over high prices, anticipating a near-term decrease in both scrap and rebar prices.

Trade participants indicated US/Baltic-origin HMS (80:20) at $422-424/t CFR and EU-origin at $416-420/t CFR.

Recent deals

• Around 500 t of shredded scrap were sold from the Middle East at $440/t CFR Qasim for end December-early January shipment.
  
  
• About 2,000 t of shredded scraps were booked from the Middle East at $436/t CFR Qasim.
  
  
• Approximately 1,000 t of shredded scrap were procured from Australia at $405/t CFR Thailand.
  
  
• A small parcel of 100-t HMS scraps were booked from the Middle East at $405/t CFR Bangladesh.
  
  

Price assessments

India: The UK-origin shredded scrap indicatives inched down by $2/t to $418/t CFR Nhava Sheva, compared to last closing on Friday.

Pakistan: The UK-origin shredded scrap indicatives were down by $2/t to $428/t CFR Qasim today.

Bangladesh: The UK-origin shredded scrap prices were assessed at $436/t CFR Chattogram, down by $4/t from last closing.

Turkiye: The US-origin HMS (80:20) bulk prices edged down by $1/t to $425/t CFR Turkiye.

Outlook

In the short term, it is expected that imported scrap offers will continue to be volatile due to subdued demand across various markets. Additionally, the combination of holidays and winter conditions is anticipated to result in reduced scrap collection in Europe, thereby influencing pricing dynamics.