Prices of imported ferrous scrap in India have dropped by over $50/mt in less than a week amid strong resistance to present offer levels and eased supply. An extended standoff between buyers and sellers pressured many traders to take short-selling positions.
The downtrend could continue till the Chinese New Year holidays end in February. Historically, it is a bear run for the steel market in the period.
The Davis Index for containerized shredded, Thursday, settled at $432.08/mt cfr Nhava Sheva, down by $6.67/mt from Wednesday. With this decline, Indian mills could resume trades for shredded in the coming days. Alloy makers increased inquiries for shredded on Thursday.
Most buyers are still opting for domestic scrap, prices for which have declined by Rs2,500-3,500/mt in the last two weeks. US suppliers offered shredded at $435-445/mt cfr India, but buyers found these prices unviable.
The Davis Index for UAE-origin HMS 1&2 (80:20), Thursday, settled at $372/cfr Nhava Sheva down by $8/mt from Wednesday. A few traders offered #1 HMS at $375-380/mt cfr Nhava Sheva. Around 5,000mt of HMS 1&2 (80:20) of Dubai-origin traded at $360-370/mt cfr Nhava Sheva. Mills expect prices to drop to $350-355/mt cfr Nhava Sheva, but yards are likely to offer some resistance.
On Thursday, a few offers for cast iron, rotors, and drums were at $400-410/mt cfr Nhava Sheva, but buyers were not keen on those price levels.
In China, demand for steel is limited ahead of the Chinese New Year holidays starting in February. Lockdown in the steelmaking province of Hebei has led to piled-up inventories. Spot iron ore prices were at $168-169/mt cfr China for Fe content 62pc. On Wednesday, Q235 150mm square billets prices in China were unchanged at CNY3,810/mt ($588/mt) ex-works Tangshan, including 13pc VAT.
The daily Davis Index for containerized shredded, Thursday, settled at $426.24/mt cfr India subcontinent, down by $8.71/mt. The daily index for containerized US-origin HMS 1&2 (80:20) settled at $392.60/mt cfr India subcontinent, down by $6.47/mt.