South Asian ferrous scrap market stumbles amid cautious domestic, global headwinds
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The South Asian ferrous scrap index witnessed a decline today owing to both domestic and global factors. In India, a significant gap between bids and offers led to a cautious approach among buyers, stalling demand for the imported material. Pakistan's market activity has slowed due to seasonal rains and delayed payments, while Bangladesh remained moderately active amidst the ongoing political turmoil. Meanwhile, in Turkiye, scrap prices have dipped slightly, with market participants closely watching China's rising iron ore prices for future direction.
Overview
India: In India, demand for imported scrap remained sluggish due to a significant gap between bids and offers. Traders and suppliers observed that buyers showed minimal interest in the current offers, choosing instead to adopt a wait-and-see approach, anticipating a potential drop in prices. Indicative offers for shredded scrap from the US and UK/Europe were at around $397-400/t CFR Nhava Sheva, while HMS (80:20) offers were at $375-380/t CFR.
A trader from northern India noted, "We've just returned from the week-long holidays, and buyers have yet to resume full operations. There's little interest right now due to the price disparity."
A representative from a trading company added, "Market sentiment is very depressing -- there are no inquiries, and no one is responding to offers. There is more than a $10/t gap between what buyers are asking and what sellers are offering."
Another supplier said, "The bid-offer gap is particularly noticeable for UK material. However, some buying continues in south India, mainly for HMS from New Zealand and Australia. It's mostly need-based."
Pakistan: In Pakistan, market activity has slowed down due to the ongoing rainy season, which has dampened the domestic steel market. Additionally, delayed payments have continued to strain cash flows.
A steel mill official stated, "It's currently a buyer's market. Sales are sluggish, and payments are delayed. Most buyers and traders are in a wait-and-see mode, anticipating a stable price trend."
A supplier noted, "After Turkiye purchased cheaper Chinese billets, imports in Pakistan came to a halt as buyers paused to assess the market. Now that some stability is evident in both Turkiye and China, we expect buying to resume within 1-2 days, though gradually."
In the domestic market, scrap prices were at PKR 145,000-150,000/t exw, while rebar prices were at PKR 255,000-260,000/t exw.
Bangladesh: The Bangladeshi imported scrap market showed a moderate trend today, still feeling the effects of the ongoing political turmoil. Offers for US shredded scrap were reported at $400/t CFR Chattogram, while Australian shredded scrap was offered at $410/t CFR.
HMS 90:10 offers from Brazil were around $390/t CFR.
A supplier noted, "In Bangladesh, local rebar prices have recently risen by up to BDT 5,000/t, leading to decreased interest for imported scrap."
Turkiye: Turkish deep-sea imported ferrous scrap prices dipped slightly, with offers for US-origin HMS (80:20) scrap assessed at $370/t CFR, down by $1/t. Market participants closely monitored rising iron ore prices in China, as they believed continued recovery in China could limit further declines in Turkish scrap prices. Despite this, Turkish buyers continued to pressure recyclers, attempting to push prices below $370/t CFR.
In the domestic market, some Turkish steelmakers responded to weak finished product demand and falling imported scrap prices by lowering their scrap purchase prices.
Price assessments
India: UK-origin shredded scrap indicatives were assessed at $402/t CFR Nhava Sheva, down by $1/t compared to last closing on Friday.
Pakistan: UK-origin shredded indicatives dropped by $5/t to $398/t CFR Qasim.
Bangladesh: UK-origin shredded prices were assessed at $415/t CFR Chattogram, down by $1/t compared to the last closing on Friday.
Turkiye: US-origin HMS (80:20) bulk prices were at $370/t CFR Turkiye, down by $1/t compared to the last closing on Friday.
