South Asia: Indian buyers distant from seaborne market due to bid-offer gap, subdued steel sales

The South Asian scrap market experienced significant fluctuations influenced by regional economic and political factors. In India, buyers have remained distant from the seaborne market due to bid-offer disparities, domestic scrap market volatility, and a slowdown in the steel market. The newly announced budget for financial year 2024-2025 (FY24-25) maintained a nil import duty on ferrous scrap, supporting the country's carbon-neutral goals.

Meanwhile, Pakistan's scrap demand has been subdued owing to slow rebar sales, though market recovery is anticipated following an IMF approval that might address letters of credit (LC)-related issues. In Bangladesh, imported scrap inquiries have dwindled amid violent civil unrest and a deepening economic crisis.

Turkish deepsea scrap prices have remained stable, with a reported stalemate among mills and sellers due to lack of fundamental market changes. The market anticipates further price stability, with Turkish mills opting for more cost-effective billet imports from the Far East and CIS regions.

Overview

India: Indian buyers continued to stay away from the seaborne market due to bid-offer disparities, volatility in the domestic scrap market, and a slowdown in the domestic steel market. Today marked the announcement of the budget for FY24-25, in which the import duties on ferrous scrap remained nil, aligning with the country's goal to achieve a carbon-neutral footprint.

Indicative offers for shredded scrap from the US and UK/Europe were assessed at $410-415/t CFR Nhava Sheva. Some suppliers quoted prices above $420/t, but there were no takers at these levels. HMS (80:20) offers from West Africa and the UK/Europe were assessed at $385-390/t CFR.

Pakistan: In Pakistan, demand for imported scrap has been subdued, primarily due to sluggish rebar sales. Indicative offers for shredded scrap are currently reported at $425-430/t CFR Qasim from the UK/Europe, $420-425/t CFR from the US, and $435/t CFR from the UAE, with buyers adopting a cautious approach to procurement.

As per market participants, the market may see improvement following the recent IMF approval, which could alleviate LC-related issues and potentially lead to a recovery in the near term.

In the domestic market, scrap prices were assessed at PKR 150,000-160,000/t, rebars were at PKR 255,000-260,000/t and billets at PKR 215,000-220,000/t.

Bangladesh: Imported ferrous scrap inquiries remained minimal in Bangladesh due to violent civil unrest and a worsening economic crisis. Indicative offers for shredded scrap from the UK/Europe were reported at $420-425/t CFR, while HMS (80:20) was offered at $405-408/t CFR.

Turkiye: Turkish deepsea imported ferrous scrap prices remained largely stable at 390/t CFR as mills and sell-side sources reported a stalemate due to minimal fundamental changes. Indicative tradable values for US/Baltic-origin premium HMS (80:20) were at $389-390/t CFR. Shortsea scrap prices also stayed stable, with Romanian-origin HMS (80:20) assessed at $370-373/t CFR. Market participants expected continued price stability in the near term. Meanwhile, Turkish mills showed a preference for importing billets from the Far East and CIS regions, as these were more cost-effective compared to current scrap prices, allowing for more competitive rebar production.

Price assessments

India: UK-origin shredded scrap indicatives were assessed at $413/t CFR Nhava Sheva, down by $1/t d-o-d.

Pakistan: UK-origin shredded indicatives were assessed unchanged d-o-d at $426/t CFR Qasim.

Bangladesh: UK-origin shredded prices were assessed stable at $425/t CFR Chattogram.

Turkiye: US-origin HMS (80:20) bulk prices were assessed unchanged at $390/t CFR Turkiye.