Indian steel mills continued active inquiries and trades for imported scrap on Thursday. Increased finished steel prices and indications of a further rise in the global scrap market lifted imported scrap prices. Mills might resume restocking scrap as Indian currency showed signs of appreciation on Thursday. The rupee appreciated to 74 levels against the US dollar. Firm demand from downstream industries and a faster-than-expected recovery in India’s steel sector is likely to continue for the next few months, according to steelmakers.

 

Fewer HMS offers 

Indian ferrous scrap importers prefer HMS scrap due to shorter delivery period. Despite supplies from different regions, there is a shortage of offers in the market. Many South African HMS suppliers are still not able to export due to permit issues and only a few yard are operating in West Africa. Australian suppliers prefer to sell to Bangladesh. Indian buyers avoid US and UK-origin HMS materials on quality concerns and a longer delivery period. 

 

Only UAE-origin HMS is available, which has pushed up offer prices sharply. “Pakistan is the preferred destination for shredded and India for HMS scrap,” said a trader. This week suppliers from the UAE preferred Indian buyers over Pakistan. The daily Davis Index for UAE-origin HMS 1&2 (80:20), Thursday rose by $1/mt to $318/mt cfr Nhava Sheva with few deals by Jalna-based EAF makers heard at $315-318/mt cfr Nhava Sheva. Offers for containerized #1 HMS without the cast and galvanized iron from Dubai were above $320/mt cfr Nhava Sheva. Traders expect a slow down in buying ahead of the Diwali festival. 

 

The Davis Index for US-origin HMS 1&2 (80:20) inched up by $0.92/mt to $318.71/mt cfr Nhava Sheva on Thursday as trades picked up. Suppliers are offering bulk cargoes of HMS 1&2 (80:20) at $325-330/mt cfr Kandla, but buyers showed limited interest at these price levels. Bulk demand could recover for January shipments post Diwali and the prices could reach $350/mt cfr Nhava Sheva.

 

In the steel export market, Indian mills are expecting bids of $445-450/mt fob, up $10-15/mt from the prior week. However, buyers are offering upto $455-460/mt cfr SE Asia. Slower recovery in the export market has limited trades.

  

The Davis Index for containerized shredded on Thursday settled at $328.58/mt cfr Nhava Sheva, up by $0.25/mt from Wednesday. A few buyers are willing to pay $328-330/mt cfr Nhava Sheva for shredded. Importers said only major stainless steelmakers and alloy makers can book material at such high levels. Offers for imported scrap jumped to $330-335/mt cfr Nhava Sheva.

  

In northern India, many importers are still waiting for the normalization of rail services to get their containers delivered. A few preferred domestic scraps as a stopgap measure, but volumes remain limited. Mills have urged the State governments to resume rail services on the Mundra port -Punjab route. The Punjab government has warned the producers to brace for the massive power cuts as the last operating thermal power plant has shut due to short supply of coal. 

 

Subcontinent

Limited container availability caused by a mismatch between imports and exports has pushed freight prices up for a few routes in South Asia. The daily Davis Index for containerized shredded, Thursday, settled at $326.56/mt cfr India subcontinent, up by $0.36/mt from Wednesday. The daily Davis Index for containerized US-origin HMS 1&2 (80:20) was at $315.80/mt cfr India subcontinent, up by $0.77/mt from Wednesday. 

 

($1=Rs74.02)

Leave a Reply

Your email address will not be published.