South Asia: Imported scrap prices unchanged d-o-d, bid-offer disparity persists

The South Asian ferrous scrap market remained largely stable compared to yesterday (22 May 2024). However, Indian buyers continued to adopt a wait-and-see approach, anticipating a potential drop in prices due to bid-offer disparities. Meanwhile, Pakistani buyers remained on the sidelines, facing challenges from a subdued domestic steel market and payment delays. Similarly, in Bangladesh, imported scrap bookings slowed down due to cash flow constraints and a sluggish local steel market.

Shredded scrap offers remained unchanged in India, Pakistan and Bangladesh. Moreover, bulk HMS (80:20) offers from US to Turkiye were also stable d-o-d.

Overview

India: In India, buyers adopted a wait-and-watch stance, anticipating a drop in offers amid bid-offer disparities. Offers for shredded scrap from the US and Europe were assessed at $415-420/t CFR Nhava Sheva, with some traders offering around $425/t CFR, while buyers were seeking $410-415/t CFR. HMS (80:20) offers from West Africa and Europe were at $405-410/t CFR, with buyers looking for $395-400/t CFR.

A trader noted, "The market had more enquiries but at lower levels, as mid-June to August buyers remained sidelined due to monsoon imports. Selling below $420/t was not viable for us, and we were waiting for supplier quotes lower by, say, at least $6-8/t to make costs feasible."

Additionally, a bulk scrap vessel from Singapore has arrived at Chennai port, comprising shredded, busheling mix scrap, with an average price of around $418-422/t CFR, according to market participants.

Pakistan: Pakistani buyers remained on the sidelines due to a subdued domestic steel market and payment delays. Indicative offers for shredded scrap from the UK/Europe were assessed at $415-418/t CFR Qasim.

A trader said, "Suppliers appear quiet, with the latest reported price ranging from $415-418/t. The booking environment is exceedingly fragile, and quotes from the UAE are sparse due to limited response from mills. As we monitor the current domestic steel market, we anticipate a slow week ahead, with the bid-offer gap likely widening until prices stabilise."

Bangladesh: Bangladeshi buyers have slowed imported scrap bookings due to cash flow constraints and a slowdown in the domestic steel market. Indicative offers for shredded scrap from the UK/Europe were heard at $418-420/t CFR Chattogram, while HMS (80:20) was at $405-408/t CFR.

Turkiye: Turkish imported ferrous scrap prices witnessed a largely stable trend in recently concluded deals.

• A US supplier sold HMS (80:20) at $379.5/t and shredded and bonus scrap at $399.5/t CFR to a Mediterranean region-based mill.
  
  
• A Northern European supplier sold a bulk cargo comprising HMS(80:20) at $372/t CFR Turkiye.
  
  
• A UK-origin supplier sold a bulk vessel to an Aegean region-based mill comprising HMS (80:20) at $373/t CFR Turkiye for early June 2024 shipment.
  
  

Price assessments

India: UK-origin shredded scrap indicatives were assessed stable d-o-d at $418/t CFR Nhava Sheva.

Pakistan: UK-origin shredded indicatives were assessed unchanged at $416/t CFR Qasim.

Bangladesh: UK-origin shredded prices were assessed flat at $421/t CFR Chattogram, d-o-d.

Turkiye: US-origin HMS (80:20) bulk prices were assessed at $380/t CFR Turkiye, stable d-o-d.

Outlook

In the near term, imported ferrous scrap offers in the South Asian region are likely to remain volatile due to bid-offer disparities across markets, with sellers unable to lower costs amidst higher collection costs and rising freight rates. However, buyers are resisting current price levels.