Imported scrap prices in Pakistan remained on a downtrend following global cues. On Thursday, opinions on the price direction were mixed with some expecting a further decline while others believed prices have bottomed out.
Domestic steel prices were under pressure in a slow market and mills tried to encourage sales by offering discounts. Steelmakers with low ferrous scrap inventories purchased small tonnages to keep their furnaces running.
The daily Davis Index for containerized shredded, Thursday, fell by $2.70/mt to $401.88/mt cfr Port Qasim. A few sellers from the US and UK/EU sold shredded at $400-405/mt cfr Port Qasim. Some other UK yards kept offers unchanged at $410-415/mt. Asking prices for Australia-origin shredded were at $405-410/mt cfr Port Qasim. Trades were few as sellers were unwilling to match present bid levels amid tight supply, elevated processing cost for shredded, and high freight rates on Thursday again.
In Turkey, the availability of lower-priced ship breaking scrap in the range of $380-390/mt kept mills away from seaborne trades. Bids were at $390-395/mt cfr Turkey for HMS 1&2 (80:20) pulling the index down by $1.25/mt to $397.5/mt cfr Turkey. The fall in prices also pulled down imported HMS offers in South Asia. The daily index for US-origin HMS 1&2 (80:20) settled at $375.71/mt cfr Port Qasim, down $1.79/mt.
In the US domestic market, shredded prices could drop by $50-60/nt while obsolete scrap by $20-40/nt in February amid easing supply due to improved collection rates. The quantum of the drop in the US domestic would offer clarity on the direction.
Offers for #1 HMS and P&S from UAE were unchanged at $380-385/mt cfr Port Qasim, depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20), Thursday, settled at $370/mt cfr Port Qasim down $1/mt. Some UAE sellers refused to lower offers. Mills targeted $365-370/mt cfr Port Qasim for Dubai-origin HMS 1&2 (80:20). Offers for #1 busheling were at $430/mt cfr Port Qasim which buyers were unwilling to accept.
Lack of demand weighs down domestic steel
Domestic steel prices and sales are under pressure with buyers reluctant to book material. On Thursday, domestic Bala billet prices were unchanged at PKR95,000-96,000/mt ex-works Lahore. Early in the week, mills had raised their offer prices for G-60 to PKR135,000-140,000/mt ex-works but failed to attract buyers. Trades for G-60 rebar in Karachi were at PKR125,000-130,000/mt ex-works, while local rebar traded at PKR108,000-112,000/mt ex-works depending on delivery terms.
Domestic Art Q toke scrap equivalent to a mix of HMS and P&S was offered at PKR77,000-77,500/mt ex-works Lahore. Few traders anticipate prices to pick up in the coming days on a shortage of domestic scrap.