Weekly round-up: Global ferrous scrap market heads south

The global ferrous scrap market remained slow due to the natural calamity in Turkiye as trade volumes shrunk in the first half of the week. The South Asian ferrous scrap market remained mostly sluggish with a marked decline in buying appetite, especially from Pakistan and Bangladesh. The Indian ferrous scrap market was slow as buyers sought to gain price clarity and small container bookings were reported. China's Shagang Steel revised its scrap purchase prices this week, too, and Vietnamese scrap prices were subdued after the Kanto tender.

Turkish market resumes after tremor: Turkish import scrap purchasers and steelmakers reduced their trading activities following the earthquakes that wreaked havoc in southern Turkiye and northern Syria. A few bulk cargo bookings were reported from the US and Europe.

Recently, a US bulk cargo comprising HMS(80:20), shredded, and bonus was booked by a mill based in the Mediterranean region at $420.5/t and $440.5/t CFR Turkiye, respectively, on 16 February 2023.

SteelMint's daily assessment for HMS 1&2 (80:20) from the US stood at $413/t CFR Turkiye, down significantly by $12-14/t w-o-w.

Pakistan market silent amid currency crisis: Letters of credit (LC) are not being opened due to the significant currency devaluation in Pakistan. As a result, imported scrap is not being delivered to Pakistani ports. At the moment, the market is based on local scrap prices. SteelMint notes that political uncertainty and the prolonged currency crisis are pressuring mills to boost domestic finished steel prices.

SteelMint's assessment for imported shredded scrap in containers is at $460-470/t CFR, down $5-10/t w-o-w.

Bangladesh market remains sluggish: Although the market for ferrous scrap in Bangladesh is quiet, LC openings seem to have become more accessible, allowing the larger mills to meet pressing demand. While demand from Vietnam for ferrous scrap of American origin has surged, bulk scrap exporters are shifting their focus to the South East Asian countries.

Fresh offers for US-origin bulk HMS are heard at $460/t CFR Chittagong, stable w-o-w. Containerised offers for UK-origin shredded scrap are at 490-95/t CFR, stable w-o-w.

Indian participants on wait-and-watch mode: Indian ferrous scrap prices remain under pressure with lesser enquires from buyers, as market participants opine that overall uncertainty is impacting bulk trade volumes.

Prior bulk consignments are being received at several ports in the country. The container market remains dull but some mini-mills have booked minimal volumes to meet immediate requirements.

SteelMint's assessment for imported shredded scrap in containers is at $455/t CFR, down $10-14/t w-o-w.

Japanese export market stable w-o-w: Due to strong finished steel demand on the domestic market, Japanese scrap prices have risen steadily which has prevented foreign purchasers from acquiring material. Vietnam's steel demand is still weak, and credit issues are also a concern in the construction and real estate sectors.

Moreover, South Korean mills have adequate inventory and so buyers anticipate further price reductions.

SteelMint's assessment for Japanese H2 scrap export prices stands at JPY 52,500-53,000/t ($390-393/t) FOB, down JPY 300/t ($2/t) w-o-w

Shagang Steel revises scrap buy prices: China's Shagang Steel has trimmed scrap purchase prices for the first time this month by RMB 50/t ($7/t) for all grades. After two consecutive hikes, the company has lowered bids. After the revision, HMS (6-10 mm) prices are at RMB 3,150/t ($462/t) delivered to headquarters, including 13% VAT.

Vietnam's ferrous scrap market sluggish: Vietnam's imported scrap market continued to remain silent after the recently concluded Japanese bellwether Kanto Tetsugen scrap export tender. Vietnamese buyers and steelmakers are not showing appetite for imported materials.

Also, imported scrap prices are inching down as domestic scrap prices are becoming more attractive.

Offers for Japanese bulk H2 scrap stood at $450/t CFR Vietnam, stable w-o-w. Meanwhile, bulk offers for US-origin HMS 1&2 (80:20) were heard at $460/t CFR. Buyers are yet to resume bulk cargo bookings due to disparity in bids and offers.