Very few trades for imported scrap happened in Pakistan on Wednesday as buyers stayed away from restocking material due to heavy winters and record-high imported scrap prices. Only those with urgent requirements bought minimal-volume to keep their operations running. However, steel prices rose marginally.
The Davis Index for containerized shredded, Wednesday, inched up by $2.78/mt from Monday to settle at $457.78/mt cfr Port Qasim. Hardly any deals were confirmed on Wednesday. Following global cues in the ferrous market offers on Wednesday were above $465-470/mt cfr Port Qasim. Global uncertainties prevented leading steelmakers from booking material despite depleting inventories. Many supplier yards have already shut operations could reopen only in the first week of January.
Global iron ore prices declined by $8/mt to $167/mt cfr China on with the further possibility of decline. Drop in supply and demand resulted in reduced futures and spot steel prices in China. Lockdowns due to new strain of COVID-19 has hurt market sentiment. Countering this, allowance of Chinese ferrous scrap imports is likely to keep global ferrous scrap prices supported.
There were no offers from Dubai suppliers who chose to cater to the domestic market. The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $442/mt cfr Port Qasim, up by $4/mt from Tuesday. Offers have increased by $15-20/mt in the past couple of days.
Rising domestic scrap consumption resulted in limited offers for HMS for exports. Offers for Dubai-origin containerized mixed #1 HMS and P&S sarya were above $445-450/mt cfr Port Qasim on Wednesday, forcing many mills to step back. Harsh winter in all regions except Karachi has impacted transportation and construction activities.
The index for US-origin HMS 1&2 (80:20) settled at $440.71/mt cfr Port Qasim, up by $3.21/mt from Tuesday. US suppliers focused on the bulk demand in Turkey while a few offered materials to buyers in East Asia.
Billet and domestic scrap prices jump PKR2,000/mt
In the domestic market, Bala billet prices showed a jump on Wednesday rising to PKR95,500-96,000/mt ($595-598/mt) ex-works. Trades picked up for commercial billets amid rising imported scrap prices. Many small mills opted for production cuts during winter to match the supply and demand gap.
In Karachi, citing high volatility in the international scrap markets and skyrocketing prices, many major mills have paused sales nationwide. Asking rates for rebar before the mill stopped accepting bookings were at PKR122,000-123,000/mt ($760-767/mt) ex-works but failed to encourage trades. In Punjab, G-60 rebar prices heard at PKR117,000-118,000/mt ex-works.
Domestic scrap
Following strengthening Prices for Art Q toke scrap equivalent to a mix of HMS and P&S was on a gradual uptrend with prices at PKR75,500-76,000/mt ex-yards Lahore. Trades for the Pure Q Toke (shredded) rose to PKR76,500-77,000/mt ($477-480/mt) ex-yards, with offers above PKR78,000/mt ex-yards on Wednesday.
($1=PKR160.5)