Prices of shipbreaking scrap rose on Friday as shortage of oxygen in the yards has slowed down the production and created a deficit of material at Alang.
The daily Davis Index for HMS attachments and Melting rose by Rs150/mt ($2.04/mt) to Rs25,700/mt and Rs24,700/mt ex-Alang, respectively.
Rolling scrap prices remained mixed on Friday as trades were low amid limited demand from the rolling mills. The daily Davis Indexes for 4Ani declined by Rs200/mt to Rs26,300/mt ex-Alang, and for 6Ani declined by Rs50/mt to Rs27,450/mt ex-Alang.
A shipbreaker told Davis Index that inventories at yards will last only one week and later if the oxygen supply is not restored, they might have to shut down operations.
Shortage of supply made shipbreakers raise their offers. The index for 12Ani rose by Rs100/mt to Rs29,500/mt ex-Alang with few transactions reported at the index price.
Demand for steel plates is slowly picking up as consumption form auto sector is picking up. The daily Davis Indexes for 1kg plates rose by Rs250/mt to Rs25900/mt ex-Alang and for 2kg plates rose by Rs150/mt to Rs27,500/mt ex-Alang.
Rising number of COVID-19 cases is a major concern for mill owners and shipbreakers. Production is expected to be hampered till oxygen supply is restored.