Although Pakistani mills sought seaborne ferrous scrap on Monday, most were unwilling to accept present offer levels. Sellers too resisted the current bids as limited availability of materials and vessel space made these prices unworkable. Following bullish cues from the Turkey bulk market, sellers are confident about containerized scrap prices turning up in South Asia.
Bids by a few mills in the southern region were higher by $5-7/mt on Monday compared to last week. But these levels still were short by $10/mt of the asking prices. Most buyers continued to wait for Chinese steel mills to return to the market after the spring festival holidays end on February 19. They believe, global markets would then be able to absorb a rise in finished steel prices.
The daily Davis Index for containerized shredded, Monday, rose by $6.79/mt to $422.5/mt cfr Port Qasim. A few sellers from the UK offered shredded at $430-435/mt cfr Port Qasim amid expectations of a healthy demand outlook for the next two months.
In Turkey, mills continued bulk purchases for remaining March and April shipments at prices above $410/mt cfr Turkey for HMS 1&2 (80:20). Domestic rebar prices strengthened on improved demand with offers of $600-610/mt fob Turkey, up by $15-20/mt from early February levels.
The daily index for US-origin HMS 1&2 (80:20) settled at $387.36/mt cfr Port Qasim, up by $5.36/mt. In the US domestic market, demand for ferrous scrap remained bullish aided by record-high HRC prices. Most sellers could focus on the domestic market until they get desired prices from subcontinental buyers. A few yards offered containerized HMS 1&2 (80:20) at $400-410/mt cfr Port Qasim on Monday.
Offers for the UAE-origin HMS remained on an uptrend amid rising demand. Indian secondary steel producers could resume trades in the coming days, which kept sellers bullish. Offers for #1 HMS and P&S from UAE were at $390-400/mt cfr Port Qasim, depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20), Monday, rose by $5/mt to $388/mt cfr Port Qasim.
Domestic scrap and billet prices up; sales slow
In Lahore, Bala billet prices were at PKR97,000-98,000/mt ex-works, up by PKR500-1000/mt from late last week. Bala billet prices have recovered by over PKR4,000-5,000/mt from their lowest in late January.
Rebar was offered at PKR125,000-127,000/mt ex-works Karachi, excluding discounts. Prices for domestic scrap Pure Q Toke equivalent to shredded remained unchanged at PKR80,000/mt ex-yards.
In other domestic market updates, Abbas Akberali head, of the Pakistan Association of Large Steel Producers (PALSP) stated that the Pakistan Standard and Quality Control Authority (PSQCA), an attached department of the S&T ministry, is yet to ensure the implementation of national standard in the steel sector. Production of substandard steel poses a risk to infrastructure and also puts documented producers at a disadvantage.