Weekly round-up: Global ferrous scrap markets reveal mixed price signals amid weak demand

• Weak demand, declining steel prices drive down scrap offers
  
  
• Price hikes in the UAE reflect stronger local demand
  
  
• Pakistan, Bangladesh witness lower scrap prices
  
  

This week, global scrap markets saw a mixed trend. While some regions, like the UAE, experienced price increases driven by local demand and price adjustments, others such as Turkiye, India, Pakistan, and Bangladesh, saw declines due to weak demand, sluggish steel conditions, and financial constraints. Taiwan's market softened, reflecting global price weakness, while the US export index dropped due to lower demand from major buyers.

Turkiye: This week, Turkiye's imported scrap market remained weak throughout the week, with US-origin HMS (80:20) prices dropping by $12/t w-o-w to $344/t CFR, the decline was driven by weak demand from Turkish mills and resistance from US recyclers due to falling rebar sales and a stronger US dollar.

European recyclers maintained competitive prices, further pressuring the market, while domestic rebar sales slowed, exacerbated by colder weather and reduced construction activity. The availability of cheaper Chinese billets added to the cautious sentiment among mills.

Despite some optimism over potential demand from South Asia, limited buying interest and a subdued market environment suggest minimal movement in the short term, with participants uncertain about any significant price recovery before the holiday season.

India: India's imported scrap market saw subdued activity this week due to weak demand, sluggish steel conditions, and buyer caution. Shredded scrap offers from the US and UK/Europe dropped 1% to $386/t CFR from $391/t, while HMS remained at $360-370/t CFR, with limited buyer interest. Despite ample inventories, buyers continued to target lower price levels, maintaining a gap between bids and offers.

Global influences, including Turkish price pressures, weakened market confidence as Indian buyers hesitated, awaiting potential price corrections. Suppliers faced difficulty lowering prices due to high procurement costs, while buyers adopted a wait-and-watch approach for clearer trends. Overall, the market remained stagnant, with sentiment favoring further softening unless a significant recovery in steel demand occurs.

During the week, only 2,000-3,000 t of scrap were booked, including HMS 1 and HMS (60:40) sourced from Peru and Costa Rica, priced at $383/t and $345/t, respectively.

Pakistan: This week, Pakistan's imported scrap market saw a decline, with shredded scrap prices dropping by $5/t to $387/t CFR Qasim. Weak demand and liquidity issues, kept the market subdued. The lockdown in Lahore due to severe smog disrupted industrial activity, further dampening market sentiment, while buyers targeted lower prices for February shipments.

Local rebar prices remained stable but high, with sellers pushing for cash sales to address liquidity concerns, the market was still affected by a wide gap between bids and offers, limiting transactions.

Despite this some recent bookings occurred during the week, around 4,000-5,000 t of scrap were booked, including Fabrication and Shredded scrap sourced from the UAE and UK/EU, priced at $398/t and $384-393/t, respectively. Of this, 3,500-4,000 t were shredded scrap.

Bangladesh: This week, Bangladesh's imported scrap market remained sluggish, with shredded scrap prices falling $7/t w-o-w to $389/t CFR Chattogram, while bulk HMS (80:20) from the US fell by $5/t from $380/t to $375/t.

The decline was driven by weak domestic steel demand and financial constraints, particularly limited LC availability. Buyers were hesitant to purchase, expecting prices to decline further. Domestic scrap and rebar prices both fell slightly as mills faced sufficient rebar inventories for 15 days and liquidity issues, limiting buying activity.

By week's end, some bulk transactions occurred, with buyers securing material at lower prices in anticipation of future demand recovery.

South Korea: South Korea's imported scrap market remained quiet this week, with stable prices amid weak demand and low construction activity. Light A-grade scrap was priced at KRW 360,000/t ($257/t), and Heavy A at KRW 385,000/t ($275/t).

Domestic sentiment was bearish due to a struggling real estate market and falling steel product prices, which led to reduced production rates. Japanese H2 demand held steady, with mills maintaining bid levels for HS at JPY 50,000/t ($322/t) and Shindachi Bara at JPY 49,000/t ($316/t) CFR Korea.

Japan: Japanese H2 scrap export offers remained steady w-o-w amid subdued demand and elevated freight costs, with prices at JPY 45,000/t ($291/t) FOB Tokyo Bay. Domestic FAS collection prices for H2 grade increased slightly to JPY 41,000-42,500/t ($265-275/t), driven by shippers securing material for incoming vessels. Regional prices in Japan also held stable, with Kanto at JPY 41,500/t ($268/t), Kansai at JPY 36,600/t ($236/t), and Chubu at JPY 36,200/t ($234/t).

Vietnam: The imported scrap market, which continues to meet 70-80% of the country's needs, remained subdued this week due to weak demand and high freight costs. Japanese H2 offers were reported at $335-350/t CFR, but bids were around $330/t, limiting trade activity.

Domestic scrap prices held steady for the sixth consecutive week. Domestic demand remained low as mills operated at reduced capacity, largely due to delays in government project approvals, which further suppressed market activity.

Taiwan: Taiwan's imported scrap market softened this week as Feng Hsin Steel cut rebar and scrap prices for 18-22 November. Rebar was lowered to TWD 18,400/t ($567/t), and local HMS (80:20) dropped to TWD 9,000/t. The reductions were influenced by weaker global scrap prices, with US HMS at $315/t CFR (down $3/t) and Japan's H2 stable at $325/t CFR. The softening reflected weak global trends and subdued local demand, driven by weak construction activity and declining steel prices.

UAE: The UAE's imported scrap market saw a price increase for processed HMS (80:20), with prices rising by AED 15/t ($4/t) w-o-w. This increase was driven by Emirates Steel's decision to raise its rebar prices for December sales. Processed HMS (80:20) prices moved within a range of AED 1,247-1,276/t ($340-347/t), settling at AED 1,276/t ($347/t) by the end of the week. The rise reflects stronger demand from local mills and an adjustment in production costs.

US: The US ferrous scrap export index dropped by $11/t due to weak demand from buyers like Turkiye, Bangladesh, and India. Sluggish rebar demand in Turkiye led to lower domestic scrap purchases, pressuring prices. European suppliers lowered offers to compete with US scrap, making European material more attractive, though some Turkish mills still preferred US scrap. As a result, US suppliers reduced their export offers.