South Asia: Imported scrap offers rise despite weak demand on cues from Turkiye
...
The South Asian ferrous scrap market experienced a d-o-d increase despite restrained buying activities across markets. In India, steel mills remained on the sidelines due to sluggish sales of finished steel and elevated inventories, refraining from engaging in fresh scrap bookings from the seaborne market. Meanwhile, in Pakistan and Bangladesh, factors such as political unrest, challenges in LC opening, and a slowdown in the domestic steel market contributed to subdued market sentiments.
Shredded scrap offers saw a $3/tonne (t) increase in both India and Pakistan, with a $2/t rise observed in Bangladesh. In Turkiye, offers for US bulk HMS (80:20) experienced a d-o-d increase of $6/t.
Market overview
India: In India, the demand for imported scrap continued to be subdued, primarily due to limited buying interest resulting from slow sales of finished steel in the domestic market and the substantial inventories maintained by mills. Indicative offers for shredded scrap from Europe were reported at $412-415/t CFR Nhava Sheva, while HMS (80:20) was assessed at $395-400/t CFR.
A representative from a steel mill explained, "We are not interested in securing fresh materials as we already have sufficient inventories until February. Furthermore, we are awaiting an improvement in the domestic market."
Another representative from a steel mill noted, "The market is witnessing volatility, with domestic steel prices remaining soft and not encouraging buyers to acquire additional materials."
Pakistan: In Pakistan, the demand for imported scrap persisted at a slow pace, attributed to sluggish sales in semi-finished and finished steel, influenced by uncertainty surrounding the upcoming elections in February. Offers for shredded scrap from Europe were evaluated at $425-430/t CFR Qasim.
Bangladesh: In Bangladesh, imported scrap offers edged up slightly; however, purchases remained slow, attributed to LC opening challenges and political unrest ahead of the elections. Players anticipate cautiousness until after the 7 January National Election, expecting improvements in LCs and subsequent demand in the construction sector. Furthermore, buyers showed a preference for non-European scrap, seeking closer sources to reduce voyage time and avoid potential issues.
Offers for shredded scrap from Europe were assessed at $440-445/t CFR Chattogram, while HMS (80:20) were heard at $420-425/t CFR.
Turkiye: The Turkish import scrap market experienced a revival, with transactions reported this week. This post-holiday rebound is attributed to firm supplier prices and Turkish demand for February shipments.
As per market sources, the Turkish import scrap market saw a slowdown in buying as local steelmakers lacked support from the finished steel segment. Despite a buying boom in November, December witnessed a decline in purchasing activity. Turkish steelmakers booked around 24 deep-sea import scrap cargoes, a comparatively lesser number as compared to November amid uncertainty in the market's mood the post-festive period and challenges in a weak finished steel market.
Price assessments
India: The UK-origin shredded scrap indicatives were up by $3/t at $415/t CFR Nhava Sheva today.
Pakistan: The UK-origin shredded scrap indicatives edged up by $3/t to $428/t CFR Qasim today.
Bangladesh: The UK-origin shredded scrap prices were assessed at $442/t CFR Chattogram, up by $2/t d-o-d.
Turkiye: The US-origin HMS (80:20) bulk prices were assessed at $421/t CFR Turkiye, increased by $6/t d-o-d.
Outlook
In the short term, continued volatility in imported scrap offers is expected, especially in Pakistan and Bangladesh, due to political unrest. Concurrently, Indian buyers may postpone scrap procurement for an additional week, anticipating improvements in the finished steel sector and aiming to de-stock inventories.
