Imported scrap offers in Pakistan remained firm on Thursday despite tepid domestic steel demand. Mega infrastructure projects are resuming, but at a slower pace. Prices for Bala billet have shown an uptick recently as producers tried to pass on increased input costs to buyers. Rebar prices have remained flat for over a month. Should the prices move up, it could support scrap buyers to raise bids. Trades on Thursday, however, were limited and Pakistan was behind other subcontinental markets.
The daily Davis Index for containerized shredded, Thursday, rose by $0.18/mt to settle at $329.11/mt cfr Port Qasim. Trades for containerized EU and UK-origin shredded were reported in the range $325-328/mt cfr Port Qasim. Most offers from the EU/UK were at $330-335/mt cfr Port Qasim following strengthening global cues. Offers have climbed to a 16-month high.
The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $318/mt cfr Port Qasim, unchanged from Wednesday. Mills preferred shredded over HMS scrap this week. Offers for Dubai-origin #1 HMS in containers were above $320-325/mt cfr Port Qasim on Thursday. The index for US-origin HMS 1&2 (80:20) settled at $318.21/mt cfr Port Qasim, up by $0.35/mt from Wednesday. Offers for the grade from the US- and UK-origin ferrous scrap suppliers were also above $320/mt cfr Port Qasim.
In the domestic market, Bala billet prices were at PKR91,000-91,500/mt ($567-572/mt) ex-works Punjab amid recovering demand. Leading Karachi-based producers offered rebar at PKR109,500-110,000/mt ex-works, up by PKR500/mt from the prior week. In Punjab, mills refused to offer G-60 rebar at prices below PKR109,000-109,500/mt ex-works. Domestic Pure Q toke scrap, equivalent to shredded sold at PKR68,700-69,000/mt del Lahore mill at prices up by PKR300-500/mt from the last week.
Pakistani recyclers have turned active for scrapped ship imports with increased inquiries in the market. Scrapped containers and tankers are being offered in the range $350-360/ldt cfr Pakistan in the Gadani market. Shortage of rolling scrap pushed steel plate prices up this week, said a recycler.
With reduction in power tariffs announced by the government, Pakistan steel mills could lower their input costs and offer rebars at lower prices. The Pakistan Association of Large Steel Producers (PALSP) has welcomed the government’s move.
Pakistan’s currency continued to appreciate, falling below the 160 mark for the first time in the last five months. This could help traders import more scrap in the coming days.