Mills in India showed increasing interest in imported ferrous scrap as domestic demand strengthened. Receding monsoon and a dip in COVID-19 cases kept sentiment positive. Although no major imported scrap trade was reported, some restocking is expected soon.
The daily Davis Index for containerized shredded, Monday, settled unchanged at $525/mt cfr Nhava Sheva from Friday. Interest for shredded remained weak, other than a few regular alloy makers no inquiries were heard. However, amid low inventory at Indian mills, traders keep offer expectations high for India compared to other subcontinental markets.
On Monday, the Indian rupee appreciated to Rs73.29 against the US dollar compared to Friday’s closing at 74.25. This could encourage importers to resume trades.
The daily Davis Index for UAE-origin containerized HMS 1&2 (80:20) was flat at $475/mt cfr Nhava Sheva. Trades continued with the COVID-19 situation appearing to be under control amid a reduction in new infections in many regions. Industrial activities are expected to rise driving in hopes of active trades. The market expects a pick-up before activities slow down again in October-November amid festivities.
For UAE-origin #1 HMS offers remained above $490/mt cfr Nhava Sheva with very few buyers able to accept those levels.
The daily Davis Index for US-origin containerized HMS 1&2 (80:20) inched down by $1.25/mt to $478.75/mt cfr Nhava Sheva. Market participants await clarity on domestic monthly settlements for September in the US.
On Monday, Alang market was closed for the Janmashtami celebration. In Mumbai, the asking prices for rebar dropped by Rs200/mt from Friday to Rs49,000/mt ex-works on weak sales.
In Mandi Gobindgarh, ingots traded stable at Rs44,300/mt ex-works Monday, marginally up by Rs100/mt from Friday. In Chennai, market inquiries for domestic and imported scrap picked up after a brief pause during the monsoon season.
Steel prices rose in China with the announcement of an extension of production cuts to 20-30pc of total capacities in 2021 in some of the provinces including Guangxi to be completed in November. Inventories are falling and while demand improved pushing domestic steel prices up by CNY50-100/mt.
With no news of extra export tariff on steel products so far, export sentiments remain positive, but trades are yet to resume.
International iron ore futures rebounded by over $15/mt from the recent low. For Fe 62pc daily spot prices jumped above $159/dmt cfr North China on Aug 27. Iron ore supply is still challenged by serious congestion at Chinese ports.
The daily domestic billet price in China on Monday was up CNY40/mt at CNY4,990/mt ($771/mt) ex-Tangshan inclusive of VAT. Offers for imported billet in China were above $680/mt cfr. From India, billet export offers consolidated to $605-610/mt fob basis.
The daily Davis Index for containerized shredded on Monday, settled at $526.25/mt cfr Indian subcontinent, up by $2.5/mt; while that for containerized US-origin HMS 1&2 (80:20) settled at $485.75/mt cfr Indian subcontinent, down by $0.4/mt.
According to freight data with Davis Index, normalized weekly container freight rates on the New York to South Asian route stabilized. For New York to Chattogram port was unchanged at $90.3/mt, while stable at $51.74/mt, and $47.01/mt, Pakistan, and India, respectively.