Indian steel mills remained away from imported ferrous scrap and focused on domestic alternatives like scrap and sponge iron to meet immediate requirements. Suppliers dropped offers by $5-10/mt to check to buying interest. Most traders and sellers are keen on keeping offers high to offset elevated freight rates. Limited supply, softening domestic steel demand and uncertainty over rising COVID-19 cases resulted in very thin trades on Tuesday. Indian primary steelmakers switched to export markets to lower finished inventories. Primary maker competed with secondary producers tp sell rebar and billet in the export market.
The daily Davis Index for containerized shredded settled unchanged at $455.63/mt cfr Nhava Sheva, down by $6.87/mt from Monday. Mills opted for domestic scrap over imported. Offers for UK/EU-origin shredded at $455-460/mt cfr Nhava Sheva. With only a few buyers keen to refill inventories in India, most shredded supplies are being diverted into Bangladesh or Pakistan.
In Turkey, mills stepped back amid slow finished steel sales. Offers for HMS 1&2 (80:20) heard around $460/mt cfr Turkey. To encourage buyers, prices could drop $10/mt in the Indian subcontinent amid weak domestic fundamentals, said traders. On the other hand, lower iron ore prices in China dampened sentiments on Tuesday.
The daily Davis Index for UAE-origin HMS 1&2 (80:20), Tuesday, settled at $415/cfr Nhava Sheva, down by $1/mt as domestic scrap prices lost steam. Buyers in North and West India continued to resist high offers. On Tuesday, a few offers for Dubai-origin HMS #1 and P&S heard at $420-425/mt cfr Nhava Sheva with bids at $405-410/mt cfr Nhava Sheva.
The daily index for US-origin HMS 1&2 (80:20), Tuesday, remained unmoved at $427.5/mt cfr Nhava Sheva. Suppliers kept offers firm as March settlements were up by $50-70/gt in the domestic market. Suppliers are either focusing on domestic sales or opting for Bangladeshi buyers, who are bidding around $10-15/mt more than Indian mills. Shipbreaking melting scrap prices in Alang, Tuesday, dropped by Rs500/mt to Rs30,300/mt ex-Alang amid softening demand and rising domestic scrap supply.
Chinese authorities proposed that iron ore prices should be adjusted to lower excessive profit margins following which iron ore futures lost almost by 9pc in a day. On Tuesday, Australian iron ore with 62pc Fe content dropped to $163.6/mt from $176/mt cfr China on Monday. Domestic billet prices dropped by CNY50/mt from Monday to CNY4,340/mt ex-Tangshan, including VAT.
On Tuesday, the daily Davis Index for containerized shredded rose to $457.57/mt cfr Indian subcontinent, down by $7.25/mt. The daily index for containerized US-origin HMS 1&2 (80:20) settled at $433.59/mt cfr Indian subcontinent, stable from Monday. Container availability is still low, but container freights have remained flat this week.