In Pakistan, amid a tight supply of ferrous scrap and the resulting rise in input costs, steel prices maintained their uptrend. Also, the depreciation of the Pakistani rupee against the US dollar is pushing up domestic prices.
Major rebar producers in Karachi have again hiked prices by PKR5,000/mt ($31/mt), and other large steelmakers in the Northern region are expected to follow the suit. On Wednesday, rebar prices rose to PKR155,500/mt ex-works Karachi and PKR154,500/mt ex-works Punjab. Participants believe that the market has absorbed the recent price hikes. While local rebar offers shot up above PKR140,000-141,500/mt ex-works Lahore.
Pakistani mills placed competitive bids for containerized scrap compared to Indian and Bangladeshi buyers. The daily Davis Index for containerized shredded, Wednesday, settled at $538.75/mt cfr Port Qasim, up by $1.25/mt. Deals for containerized shredded were reported at $537-538/mt cfr Qasim while sellers lifted expectations to over $540-545/mt cfr Qasim, following gradual recovery in the domestic market.
On Tuesday, spot steel prices in China rose up to CNY100/mt for the second successive day following strengthening futures, while supplier yards expect Turkish mills to resume August shipments paying higher on bullish global steel prices especially HRC. A single Baltic origin deal heard in Turkey held prices firm at around $500/mt cfr Turkey for bulk HMS 1&2 (80:20).
Pakistani mills resumed trades for HMS paying at least $30/mt higher than Indian prices. Deals for UAE-origin HMS picked up as mills raised bids amid a supply crunch in the domestic market.
The daily Davis Index for UAE-origin HMS 1&2 (80:20), Wednesday, settled at $493/mt cfr Port Qasim, up by $3/mt from a day earlier. Deals for UAE-origin HMS 1&2 (80:20) reported at around $490-495/mt cfr Qasim while those for mixed #1 HMS and P&S heard above $500-505/mt cfr Port Qasim.
The daily index for US-origin HMS 1&2 (80:20), Wednesday, settled at $502.5/mt cfr Port Qasim, up $1.25/mt from Tuesday. Container freight rates remained elevated, resulting in increased landed costs.
On Wednesday, the Pakistani rupee continued to fall against the dollar in both interbank and open markets. It depreciated to PKR159.03 against the US dollar from PKR156.9 on July 4, which further pushed up domestic steel and scrap prices.
Domestic Bala billet prices jumped by another PKR2,500/mt from a day prior. On Wednesday, offers rose to PKR126,500-127,000/mt ($795-798/mt) ex-works. Offers for G-60 billet rose to PKR13500-136,000/mt ex-works Punjab. A gap between steel prices in the global market and Pakistan could help steelmakers raise prices.
Pure Q toke scrap (equivalent to shredded), Wednesday, traded above PKR100,000-100,500/mt ex-yard Lahore, up by PKR1,500-2,000/mt from Tuesday. Offers for domestic Art Q toke scrap (equivalent to a mix of HMS and P&S) to rose to PKR98,700-99,000/mt ex-yard Lahore amid a slow pace of demolition and ship-breaking activities.