A standoff between buyers and sellers continued on Monday with no major deals reported. Buyers sought clarity on global ferrous scrap prices. Few deals for urgent requirements are expected but the possibility of active restocking is limited.
The Davis Index for containerized shredded, Monday, settled at $425/mt cfr Port Qasim, down by $2.5/mt from Friday.
Pakistani mills anticipate prices to drop further amid easing supplies and extended silence at the buyers’ end. Soon offers could match bids as buyers seem to have an upper hand.
Hike in container freights raised landed cost for buyers but sellers refused bids below $425-430/mt cfr. Mills are eyeing $410-420/mt cfr Qasim amid slow demand.
In Turkey, amid the slump in Lira’s value against the US dollar, importers stayed away from trades. It is anticipated that if Turkish buyers extend their silence, global bulk prices could drop $10-15/mt. The index for HMS 1&2 (80:20), Friday, fell by $2.33/mt to $422.67/mt cfr Turkey, while prices dropped by over $25/mt in less than 10 days.
The daily index for US-origin HMS 1&2 (80:20), Monday, settled at $410/mt cfr Port Qasim, down $2.5/mt from Friday. Landed cost on cfr basis remained high due to a hike in freight component on the New York to Pakistani port route. Fas rates have dropped steeper.
This year active scrap restocking ahead of Ramadan has been limited. With the start of Ramadan from April 12, scrap markets in Pakistan are expected to go into a hibernation mode. There is limited room for a recovery in Pakistani scrap prices in the next 20 days, believe UAE-based traders.
With persisting sluggish inquiries, offers for #1 HMS and P&S from UAE were in the range of $410-415/mt cfr Port Qasim, depending on quality. The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $403/mt cfr Port Qasim, down by $2/mt from Friday.
Domestic steel standstill
On Monday, Bala billet offers remained at PKR105,000-105,500/mt ex-works, unchanged from Friday amid slow buying post the weekend. Downstream industries await a drop in steel prices to resume trades while government infra projects continued at a slower pace amid restricted cash flow.
Asking rates for rebar dropped amid the increasing availability of discounted rebar in the market. Rebar asking rates were stable at PKR134,000-134,500/mt ex-works Karachi, while in Punjab at PKR129,000-129,500/mt ex-works. Domestic steel demand has been slower-than-expected for over a month.
In line with slow demand and softening sentiment in the Gadani shipbreaking market, offers for Art Q toke scrap equivalent to a mix of HMS and P&S, Monday, remained stable at PKR85,000-85,500/mt ex-yard Lahore. Offers for Pure Q toke scrap equivalent to shredded were at PKR86,000-87,000/mt ex-yard Lahore.
($1=PKR157.14)