Pakistan’s domestic steel prices tumbled Tuesday by PKR2,500-3,000/mt ($15.6-18.8/mt) in line with global cues. Trades remained slow as buyers stepped back while many suppliers are yet to return to the market.
The daily Davis Index for containerized shredded, Tuesday, settled at $460/mt cfr Port Qasim, down $9.06/mt from Monday. Prices have dropped around $45-50/mt in a week creating panic among buyers. Most buyers have decided to stay away from the falling market. Mills booked a couple of distressed sales for the UK/EU and the US-origin shredded at $458-465/mt cfr Qasim in containers.
Buyers aimed at $450-455/mt cfr Qasim on Tuesday. Most yards, however, did not accept lower bids, citing that the drop could be temporary. “I doubt if prices will drop over $10-20/mt from here. Prices are expected to settle down soon as scrap generation is tight and freight rates are high on containers unavailability,” said an indenter.
The daily index for US-origin HMS 1&2 (80:20) settled at $430/mt cfr Port Qasim, down $12.14/mt from Monday in the absence of major deals. In Turkey, bulk prices were under pressure as domestic scrap lost $15-20/mt this week. The next round of negotiations could open below $450/mt cfr Turkey.
Suppliers from the UAE offered #1 HMS at $430-435/mt cfr Port Qasim. The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $428/mt cfr Port Qasim down $10/mt from Monday. Pakistani mills are waiting for another $10-15/mt drop to resume trades, while Indian mills expect prices to drop below $395-400/mt cfr Nhava Sheva. Scrap suppliers and traders in Dubai could lower price in the coming day to negotiate deals.
Bala billet drops by over $78/mt in Jan
Pakistani mills have started offering discounts on steel products to encourage sales. Domestic Bala billet was at PKR95,000-96,000/mt ex-works Lahore, down PKR2,000-3,000/mt from Monday. Prices of Bala billet dropped over PKR12,500/mt ($78/mt) since Jan 7 when it reached a peak at PKR107,500/mt ex-works. Billet prices dropped aid harsh winter and slowdown in domestic activities.
In Karachi, major rebar makers offered discounts to stimulate trades. Mills in the South are offering G-60 rebar 12-32mm at PKR135,000-140,000/mt ($840-872/mt) ex-works while trades for local rebar reported at PKR113,000-115,000/mt ex works.
Domestic scrap plunges
On Tuesday, local Art Q toke scrap equivalent to a mix of HMS and P&S offered at PKR76,500-77,500/mt ex-yard Lahore lower by PKR2,000-3,000/mt from Monday. Pure Q Toke (shredded) traded at PKR80,000-81,000/mt ex-yards, down PKR2,000-2,500/mt from Monday. As the gap between G-60 rebar and local rebar increased above the usual of PKR10,000/mt, many anticipate prices to drop in the next few days.
($1=PKR160.72)