Pakistani ferrous scrap importers decided to hold back purchases after securing active bookings in the first half of this week. Despite the rise in rebar and billet asking rates, trades on the ground remained slower than expected. Due to the cyclone Tauktae, not only India but Southern Pakistan, especially Karachi, witnessed heavy rains, disturbing transportation and domestic steel trades.
There is still no clarity regarding price direction. On Thursday, mills’ buying interest turned bearish. Despite firm offers, buyers were hoping for a reduction of $5-7/mt in offers, wanting to avoid risks. However, sellers kept offers firm as finished steel prices, especially HRC, reached record-high levels in the US and European markets.
The daily Davis Index for containerized shredded, Thursday, settled at $518.57/mt cfr Port Qasim, down $1.43/mt from Wednesday. Trades were reported at $515-520/mt cfr Qasim. On Thursday, most offers for shredded from the EU/UK at $520-525/mt cfr Qasim, despite a rise in the Turkish bulk offers.
In Turkey, mills booked limited bulk cargoes after returning from the Eid holidays. Offers continued to climb up driven by high global steel prices. The daily Davis index for US-origin HMS 1&2 (80:20) rose to $509.39/mt cfr Turkey, up $4.39/mt.
Amid high raw materials prices, offers for rebar remained elevated at PKR142,500-143,500/mt ex-works Karachi. In Lahore, prices were lower by PKR4,000-5,000/mt than Karachi levels at PKR136,000-137,000/mt ex-works. Local rebar was offered at PKR130,000/mt ex-works. Few buyers are waiting for domestic demand to gain momentum and global prices to settle, particularly in China where prices tumbled by CNY200-300/mt within a couple of days.
The daily Davis Index for UAE-origin HMS 1&2 (80:20), Thursday, settled at $505/mt cfr Port Qasim, up $2/mt. Offers for UAE-origin mixed #1 HMS and P&S were at $515-520/mt cfr Qasim, however, mills bid around $505/mt cfr Qasim.
Slow recovery in demand in addition to uncertain global steel prices due to China’s strict stance to control prices led to a plunge in steel futures. The daily index for US-origin HMS 1&2 (80:20), Thursday, rose to 506.07/mt cfr Port Qasim, up $1.07/mt. Offers were firm, driven by high global steel prices and buyers’ preference for short-transit scrap.
($1=PKR153.44)