Shipbreaking scrap prices continued to decline Wednesday on subdued demand from rolling mills, especially in Gujarat. Most steelmakers were in the market to restock last week and have now turned silent. Oxygen shortage in the country could force recyclers to shut yards in the coming days.
The daily Davis Index for 4Ani declined by Rs500/mt ($6.63/mt) to Rs37,500/mt ex-Alang and the index for 6Ani declined by Rs700/mt to Rs38,000/mt ex-Alang.
Trading activity in the adjoining state of Maharashtra has also tapered because of stringent lockdown measures. Demand for long steel from end-users is, therefore, under pressure.
The index for 8Ani declined by Rs400/mt to Rs39,000/mt ex-Alang, and the index for 14Ani fell by Rs400/mt to Rs39,700/mt ex-Alang.
Most private construction projects are stalled due to movement restrictions and an exodus of laborers. The slowed pace in the construction sector has weighed down the demand for structural steel. A ripple effect has pulled the index for 1kg plates down by Rs500/mt to Rs36,500/mt ex-Alang. The daily index for 2kg plates declined by Rs700/mt to Rs38,000/mt ex-Alang.
Mills have curtailed production amid a shortage of oxygen supply. Recyclers, therefore, expect ship scrap prices to be under pressure till the oxygen supply is normalized.
The index for HMS attachments and Melting declined by Rs500/mt each to Rs36300/mt and Rs35300/mt ex-Alang, respectively.