Offers for imported stainless steel (SS) scrap on Tuesday in India jumped by almost 2-3pc from a week ago following LME nickel’s 5pc gain in the period.
The official three-month LME nickel contract on Monday, settled higher by $1,026/mt at $18,372/mt in a week. The contract climbed for five straight sessions in the previous week only to inch slightly lower on Monday. This climb in LME over the week has led to higher offers for imported 304 and 316 solids on Tuesday compared to the prior week.
Most base metals, including nickel, traded higher on a weaker dollar and strong demand outlook on US infrastructure push. Base metals gained support after a bilateral $579bn U.S. infrastructure deal bolstered economic optimism and commodities’ demand. Prices in China rose with a fall in weekly inventories.
The weekly Davis Index for 304 (18-8) solids on Tuesday settled at $1,850/mt cfr India port, up by $40/mt amid a climb in offers. Demand from mills in India has started to improve. Offers for 304 on Tuesday ranged between $1,830-1,900/mt cfr India port.
Offers for 316 solids on Tuesday were heard around $2,500/mt, but mills resisted these levels pressuring the index for the grade. The weekly Davis Index for 316 solids on Tuesday settled at $2,469/mt cfr India port, up by $63 driven by a climb in offers.
The index for 430 solids on Tuesday gained the most, to settle almost 4pc higher from a week ago. Offers for 430 solids climbed sharply to almost $800-830/mt on the higher end while bids from some mills were still below $700 levels, all cfr India port rates. Offers were justified also on elevated freight rates and ferrous scrap prices holding firm. Some mills in Gujarat, however, feel prices above $700/mt for 430 solids cfr India port are high in the current Indian market dynamics. Some foundries in India are melting ferrous scrap and chrome to make fresh SS instead of buying SS scrap, noted a market participant, as scrap prices are trading at very high prices.
The weekly Davis Index for 430 solid on Tuesday settled at $774/mt cfr India port, up by $29/mt.The Davis Index for Zurik 85/3 settled at $1,503/mt cfr India port, up by $20/mt from a week ago. Although the demand for the grade is weak at present, it could pick up in the near term with mills readying to improve production levels as lockdown restrictions have started to ease and the availability of industrial oxygen has increased.
The Davis Index for 304 (18-8) solids for Taiwan on Tuesday settled at $1,545/mt cfr Taiwan port, up by $13/mt, and the index for 316 solids settled at $2,238/mt cfr Taiwan port, up by $23/mt. Offers have inched up for Taiwan port too, on the back of a rise in LME nickel. Mills, however, kept their bids lower, which pressured the prices. Taiwan markets were quiet on Tuesday and trading could continue to remain slow, given the wet season.