Continued recovery in imported ferrous scrap demand in Asian markets and optimism over billet export trades at higher prices gave offers for HMS in India a lift. Despite weak domestic demand in the US, sellers kept offers firm on high containerized freight charges.
The daily Davis Index for containerized shredded, Tuesday, settled at $526.25/mt cfr Nhava Sheva, up by $4.25/mt. Strong demand and resulting firm prices in Pakistan kept sellers bullish in Indian markets. But a wide gap between offers and bids led to limited quantity deals in India. Most preferred to book HMS over prime grades of ferrous scrap.
The daily Davis Index for UAE-origin containerized HMS 1&2 (80:20) rose by $3/mt to $475/mt cfr Nhava Sheva. Active demand in Pakistan pushed buyers to accept higher prices for UAE-origin material. For UAE-origin #1 HMS, offers were above $480/mt cfr Nhava Sheva amid a few deals. Mixed P&S and #1 HMS traded at $490/mt cfr Nhava Sheva.
The daily Davis Index for US-origin containerized HMS 1&2 (80:20) rose by $3.75/mt to $480/mt cfr Nhava Sheva. Sellers were hopeful of demand recovery in India as most buyers have stayed away for over a month resulting in depleted inventories of scrap with mills.
Demand in the Alang shipbreaking market improved on Tuesday after remaining low for the last few days. Asking prices for melting scrap remained unchanged at Rs35,700/mt ex-yards. In Mumbai, the asking prices for rebar dropped by over Rs500/mt to Rs47,000/mt ex-works on slow sales.
In Mandi Gobindgarh, ingots traded at Rs44,300/mt ex-works Monday, down Rs200/mt from Monday. Softer cues in the domestic steel market kept importers uncertain and buyers opted for domestic material to avoid risks.
On Tuesday, iron ore futures showed recovery after a decline on Monday. Iron ore Fe 62pc daily spot prices had dropped to $131.5/dmt cfr North China on Monday, down $13.5/mt from Friday.
Amid expectations of short supply of steel due to production cuts, domestic billet prices in China increased CNY20/mt from Monday to CNY5,120/mt ($792/mt) ex-Tangshan inclusive of VAT. Offers for imported billet in China and Taiwan were above $695-700/mt cfr. From India, billet export offers were above $610-615/mt fob basis.
The daily Davis Index for containerized shredded on Tuesday, settled at $530.21/mt cfr Indian subcontinent, up by $4.46/mt; while that for containerized US-origin HMS 1&2 (80:20), the index settled at $487.65/mt cfr Indian subcontinent, up by $2.94/mt.