Shipbreaking scrap prices in Alang declined further on Wednesday amid dwindling demand from rolling mills. The market for finished steel continues to be weak, hampered by the stringent lockdown restrictions in major consuming states.
The daily Davis Index for HMS attachments and Melting declined by Rs1,300/mt ($17.85/mt) each to Rs37,200/mt ex-Alang and Rs36,200/mt ex-Alang, respectively, pressured by low demand.
Re-rolling scrap prices also fell as mills in Mandi Gobindgarh reduced their ingot prices to encourage sales. The daily Davis Index for 4Ani dropped by Rs800/mt to Rs38,700/mt ex-Alang and the index for 8Ani declined by Rs800/mt to Rs39,200/mt ex-Alang.
Demand from key consuming sectors including infrastructure and automotive continues to be low. On Wednesday, shipbreakers were pressurized to reduced their offers for ship plates. The daily Davis Index for 1kg plates declined by Rs1,200/mt to Rs37,500/mt ex-Alang and the index for 2kg plates declined by Rs800/mt to Rs39,200/mt ex-Alang.
Total tonnages in May fell by 11pc to 127,955ldt compared to April. Pakistani and Bangladeshi buyers are offering higher prices for scrapped vessels compared to their Indian counterparts.
Mills are still running at reduced capacities across India due to a shortage of liquid oxygen, hence procurement of raw material is mostly ‘just in time.’ The index for 14Ani declined by Rs800/mt to Rs39,200/mt ex-Alang.
Market participants expect ferrous scrap prices to fall further amid low domestic demand and weak global cues.
($1=Rs72.8)