Imported ferrous scrap prices in South Asia inched up driven by higher offers, but demand remains bearish. Buyers in India are adopting a wait-and-watch approach as the COVID-19 spread is yet to slow.
The daily Davis Index for containerised shredded settled at $272.95/mt cfr India subcontinent, up by $0.9/mt from $272.05/mt cfr.
The Davis Index for containerised US-origin HMS 1&2 (80:20) settled at $253/mt cfr India subcontinent, up by $0.2/mt from $252.8/mt on Monday.
Though primary steel producers have raised their capacity utilisation rate to 70-80pc, many small-scale steelmakers are still working at 40-50pc capacity.
In North India, Mandi Govindgarh market was closed on Monday only to open in the latter part of Tuesday. The market will now follow a five-day week to curb the spread of COVID-19. The state of Maharashtra also extended its lockdown till July 31 which has kept importers away from trades.
Furnaces opted for lower-priced easily available sponge iron as they increased consumption rates to 40-50pc from 10-15pc earlier. Mills are saving a conversion cost of around Rs2,000/mt by using sponge iron over imported scrap at present.
The Davis Index for containerised shredded settled at $273/mt cfr Nhava Sheva, unchanged from Tuesday. Trades for Australian-origin shredded in containers were reported at $275/mt cfr Nhava Sheva. Offers from the UK, European suppliers were at $275-280/mt cfr Nhava Sheva. Brazilian and West African HMS 1&2 (80:20) in containers traded at $240-245/mt cfr Nhava Sheva, unchanged from Tuesday. In South India, demand for imported scrap was comparatively higher than in the North.
The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $255/mt cfr Nhava Sheva, unchanged from Monday. Only a handful of buyers were interested in booking scrap from Dubai. Their bids were below $250/mt cfr Nhava Sheva.
The index for US-origin HMS 1&2 (80:20) was at $253/mt cfr Nhava Sheva, unchanged from Tuesday. A few offers were at $250-255/mt cfr Nhava Sheva with bids below $250/mt cfr.
Bangladesh steelmakers stayed away from the market Wednesday, the first day of their new financial year. Major steelmakers have ferrous scrap inventories in hand. Many are unable to increase their productions as the end-user demand remains weak due to the pandemic. The Davis Index for US-origin containerised shredded settled at $276/mt cfr Chattogram, down by $1/mt from Tuesday. Offers from Australia and New Zealand were at $270-275/mt cfr Chattogram, with buyers bidding below $270/mt cfr Chattogram.
The index for Latin America-origin HMS 1&2 (80:20) remained unchanged Wednesday at $254/mt cfr Chattogram. Brazilian HMS 1&2 (80:20) traded in the range of $250-255/mt cfr Chattogram.
The index for US-origin HMS 1&2 (80:20) settled at $260/mt cfr Chattogram, unchanged from Tuesday.
Recyclers are looking to take advantage of fall in scrapped ship prices to $290-300/ldt Chattogram.The gap between shipbreaking scrap and shredded in bulk has narrowed to just $20-25/mt against the usual of $45-50/mt.
Pakistan’s ferrous scrap importers continue to be most active in the Indian subcontinent. Pakistani buyers are importing scrap as they have limited alternatives in the domestic market. Also, finished steel prices in the country remained high despite weak demand.
The Davis Index for US-origin containerized shredded settled at $274/mt cfr Port Qasim, down $2/mt from Tuesday. Trades for US-origin shredded reported at $270-273/mt cfr Qasim on Wednesday and at $275-280/mt cfr Qasim from suppliers in the UK and Europe.
The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $258/mt cfr Qasim, down by $2/mt from Tuesday in the absence of trade. A few trades for mixed HMS 1 and P&S were reported at $265/mt cfr Qasim with bids at $255-260/mt cfr. The daily index for US-origin HMS 1&2 (80:20) was at $255/mt cfr Qasim, unchanged from Monday.
($1=Rs75.58; PKR167.69; BDT84.9)