Bullish finished steel prices boosted demand for imported ferrous scrap on Wednesday. Markets were upbeat due to the Indian government’s approval for two COVID-19 vaccines, appreciation of the currency, and a hike in finished steel prices.
Though, heavy fog in North India and rains in some southern regions impacted trades. Should rebar demand pick up more, mills could increasingly resort to trades amid limited inventories in hand.
Russia imposing export duties of €45/mt on ferrous scrap and national lockdown in Europe has exacerbated supply crunch globally.
The Davis Index for containerized shredded, Wednesday, settled at $470.63/mt cfr Nhava Sheva, up by $4.68/mt from Tuesday. Offers on Wednesday were at $475-480/mt cfr Nhava Sheva since these levels found acceptance in Pakistan. But Indian buyers lagged at $465-470/mt cfr India. The recovery in rebar demand could lead to a rise of $15-20/mt in ferrous scrap prices for January shipments in the coming days, believe most traders.
The weekly Davis Index for cast iron, rotors, and drums on Wednesday, settled flat at $454/mt cfr Nhava Sheva. Offers were very few as many suppliers are yet to return to the market. Buyers found it unviable to book at high prices. Indian mills were unwilling to raise bids above $435-440/mt cfr Nhava Sheva.
Trades for Australia-origin HMS 1&2 (80:20) were reported at $440/mt cfr Nhava Sheva for immediate shipments. While offers for February deliveries were above $450-455/mt cfr Nhava Sheva on Wednesday.
India remains the preferred market for Dubai-based HMS suppliers, but trades have slowed. Mills bid $15-20/mt lower than suppliers’ expectations. It is a sellers’ market and thus trades remained impacted. In the absence of fresh offers, the Davis Index for UAE-origin HMS 1&2 (80:20), Wednesday settled at $440/mt cfr Nhava Sheva, down by $1/mt from Tuesday. Indian mills have accepted levels of only up to $435-440/mt cfr Nhava Sheva for Dubai-origin HMS despite asking prices of $445-450/mt cfr.
The Davis Index for US-origin HMS 1&2 (80:20) settled at $445.75/mt cfr Nhava Sheva, up by $0.75/mt from Tuesday. Late last week, most US suppliers lifted offers by $15-20/mt for material on a fob and fas basis, which could impact cfr India prices. Suppliers were unwilling to trade at the current bids of $425-435/mt cfr hoping for active restocking by mills at higher prices in the next few days.
In the domestic market, ingot trades in Mandi Gobindgarh were at Rs40,800-41,300/mt ex-works, down Rs500/mt from a day ago. HMS 1&2 (80:20) prices were heard at Rs30,000/mt ($411/mt) delivered Mumbai mill, flat since Monday.
Chinese finished steel prices were resilient amid expectations of an increase in infrastructure activities. The spot price for benchmark Fe 62pc iron ore increased 1.60pc to $167.86/mt cfr Qingdao, with active trading in the seaborne and spot markets. Prices were also supported by record-high prices in coke futures. But on Wednesday, Q235 150mm square billets prices in China lowered CNY20/mt to CNY3,780/mt ex-works Tangshan, including the 13pc VAT.
The Davis Index for containerized shredded, Wednesday, settled at $471.87/mt cfr India subcontinent, up by $5.89/mt from Tuesday. The index for containerized US-origin HMS 1&2 (80:20) settled at $446.45/mt cfr India subcontinent, up by $1.62/mt. Most suppliers resumed negotiations, but US recyclers held onto material as they wait for prices to rise in the coming days.