South Asia: Imported scrap offers see mixed trend across markets; enquiries in India improve
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Today, the South Asian ferrous scrap market displayed a mixed trend. In India, enquiries have increased, but the pace remains sluggish due to price disparities. Buyers in urgent need are making purchases, while others continue to favour domestic scrap. The markets in Pakistan and Bangladesh have also slowed down due to sluggishness in the steel market and challenges related to LC issuance.
Overview
Today, the imported ferrous scrap market in India exhibited moderate activity, with a slight increase in enquiries and a few deals being finalised. Nonetheless, there persists a noticeable price differential between domestic and imported scrap offers. Buyers are participating in the market, albeit at a slower pace and based on immediate requirements. According to market sources, shredded scrap from Europe/UK is being offered at levels of around $420-425/t CFR, while HMS (80:20) is priced at $395/t CFR. However, buyers' bids are reportedly below these levels.
According to a steel mill official, "Import bookings have begun in India, but there still exists a price gap of INR 1,000-2,000/t, making domestic choices more financially favourable. The decision to book imports seems to stem mainly from volume considerations rather than price feasibility. Additionally, Pakistan and Bangladesh are still seen as more profitable markets compared to India at the moment."
Furthermore, in Pakistan, buyers are taking a cautious approach due to a significant decline in offers and a slowdown in the domestic finished steel market. Shredded scrap offers from Europe/UK were reportedly in the range of $430-435/t CFR, while offers from the USA were assessed at $427-429/t CFR. Middle East origin HMS (80:20) scraps were priced at $410-415/t CFR.
The Bangladeshi market continued to experience sluggishness due to delays in LC issuance and a weak domestic steel market. Indicative offers for Europe/UK shredded scraps were reported at $435/t CFR, while HMS was assessed at $415/t CFR. In the domestic sector, rebar prices were at BDT 89,000-90,000/t ex Dhaka, and BDT 95,000-96,000/t ex Chattogram, while billets were priced at BDT 76,000-77,000/t ex. Market participants observed a slight increase in finished and semi-finished prices compared to the previous week. However, demand remained stagnant, and mills sought lower raw material costs to enhance margins with finished products.
Turkish import ferrous scrap prices softened despite decline in European collection costs, as reported by sources. HMS (80:20) scrap offers were assessed at $403/t CFR. Turkish mills faced pressure to book cargoes for March shipment but were relieved due to sluggish rebar sales, postponing scrap imports for finished steel production. Uncertainty in finished steel demand has led to a cautious approach among mills. Sellers have ready cargoes, giving buyers an advantage. Despite drops in collection costs, Turkish mill targets for material remained unattainable for sales, reflecting market challenges. EU-origin HMS (80:20) was considered viable above $400/t CFR, while buyer targets mostly ranged from $390-395/t CFR.
Price assessments
India: UK-origin shredded scrap indicatives were assessed at $420/t CFR Nhava Sheva, up by $2/t d-o-d.
Pakistan: UK-origin shredded scrap indicatives inched down by $1/t to $430/t CFR Qasim.
Bangladesh: UK-origin shredded scrap prices were assessed unchanged at $434/t CFR Chattogram.
Turkiye: US-origin HMS (80:20) bulk prices were assessed at $403/t CFR Turkiye, down by $2/t d-o-d.
Outlook
In the near term, imported scrap offers may experience slight corrections due to decreasing collection costs in Europe and an accumulation of material with other suppliers like the US, as a result of the lack of firm demand from South Asian markets.
