India’s imported ferrous scrap prices moved up on the back of increased global scrap prices. Trades, however, were thin as mills booked material just to fulfil their minimal requirement. A few leading mills have increased their production activity. But concerns over liquidity crunch, labour shortage and subdued construction activity during the monsoons are likely to hit overall steel demand.
A few buyers withdrew their bids amid bullish global ferrous scrap prices and a possibility of increased restrictions to control the spread of COVID-19 in India.
The Davis Index for containerised shredded settled at $286/mt cfr Nhava Sheva on Friday, flat from a day ago but up by $1/mt from the prior week. Offers for shredded from the UK and Europe were in the range $288-290/mt cfr Nhava Sheva. With inventories already stocked with many, buyers were not interested in shredded scrap bookings.
The Davis Index for UAE-origin containerised HMS 1&2 (80:20) settled unchanged at $273/mt cfr Nhava Sheva from a day earlier but up by $7/mt from the prior week. The index for US-origin HMS 1&2 (80:20) was unchanged at $270/mt cfr Nhava Sheva from Thursday but up by $5/mt from the prior Friday. Offers for HMS 1&2 (80:20) were at $275/mt cfr Nhava Sheva with no buyers at those levels. In the latter part of the week, bids lowered due to operation suspensions by few mills amid a labour shortage and weak steel demand.
South African HMS 1&2 (80:20) traded at $260-265/mt cfr Nhava Sheva, up by $10/mt from the prior week. Brazilian HMS 1&2 (80:20) traded at $250-255/mt cfr Nhava Sheva.
Suppliers are banking on short term supply crunch in the coming days to give ferrous scrap prices a lift. Once activities gain momentum, the declined domestic scrap generation rate could get buyers to the import market.
The indexes for the UK and Europe-origin HMS 1&2 (80:20) were at $255/mt cfr Nhava Sheva and $260/mt cfr Chennai. Australian HMS 1&2 (80:20) traded at $265/mt cfr Nhava Sheva and Mundra, up by $3/mt from the prior week.
In Goa and Chennai, West African HMS 1&2 (80:20) was offered in the range of $255-260/mt cfr with very limited trades reported.
The index for busheling in containers settled at $300/mt cfr Nhava Sheva, up by $2/mt from the prior week and the weekly index for P&S settled at $285/mt cfr Nhava Sheva, up by $2/mt. Turning scrap traded flat at $240/mt cfr Nhava Sheva.
East Asia
Taiwan
Imported ferrous scrap prices in Taiwan rose by $5/mt on Friday with the index for US-origin HMS 1&2 (80:20) settling at $249/mt cfr Taiwan. A few trades for HMS 1&2 (80:20) were at $250/mt cfr even though offers were at $252-$253/mt cfr Taiwan. A rise in offers was driven by an increase in Turkish ferrous scrap import prices. Weak finished steel demand on the back of weather challenges kept trades limited. Buyers looked for lowe-priced material over offers from Japan and the US to reduce their input cost.
Deals for South American-origin HMS 1&2 (80:20) were heard at $235/mt cfr Kaohsiung. Offers for Australian-origin HMS 1&2 (80:20) were at $240-245/mt cfr Taiwan. In small bulk markets, Japanese HMS 1&2 (50:50) was offered at $270-275/mt cfr Taiwan, up by $10/mt from the prior Friday.
Japan
Tokyo steel has increased domestic ferrous scrap purchase prices for the sixth time in June. Prices have increased by a total of JPY3,000-4,000/mt this month. In the latest hike, bids were raised by JPY1,000/mt for deliveries to Utsunomiya plant and JPY500/mt delivered Okayama and Takamatsu works effective June 13. Bids for #2 HMS are at JPY26,500/mt del to Utsunomiya plant in the Kanto region.
Scrap generation remains tight due to lowered manufacturing activities.
Major traders, on the other hand, are holding on to their stocks in the hopes of prices to rise further in the near term.