Bids for imported ferrous in Pakistan continued to soften, weighed down by a successive drop in bulk ferrous scrap prices in Turkey. Ongoing partial lockdown in the Sindh region, including the capital Karachi, dampened demand.
The daily Davis Index for containerized shredded, Wednesday, dropped $4/mt to settle at $531/mt cfr Port Qasim. Bids at $528-531/mt cfr Qasim while sellers expect above $535/mt.
Most secondary and rerolling mills are expected to begin restocking scrap inventories in the coming days, which could boost trades. However, mills decided to resist and test sellers’ patience.
In Turkey, easing scrap supply and falling domestic rebar prices slowed trades. The index for US-origin HMS 1&2 (80:20) dropped to $463.6/mt cfr Turkey, down $6.24/mt. Containerised prices, hence, were under pressure on Wednesday.
In China, finished steel futures for HRC and rebar reversed the trend to rise by 2-3pc on Wednesday. Most expect prices to hold as they have neared the bottom.
Sellers in the UAE continued to offer HMS scrap to Pakistan amid steady demand. Bids from Indian buyers are at least $20/mt below those from Pakistan. The daily Davis Index for UAE-origin HMS 1&2 (80:20) declined by $3/mt to $492/mt cfr port Qasim. Trades for UAE-origin mixed #1 HMS and P&S stable at $505-510/mt cfr Port Qasim.
The daily index for US-origin HMS 1&2 (80:20), Wednesday, fell to $487.5/mt cfr Port Qasim, down $5/mt. As the August monthly settlements opened with prices for obsolete grades down $20/nt in the US domestic market, HMS supply is expected to ease out in the coming days.
Most large-scale steel producers kept rebar asking prices elevated on high input costs. On Wednesday, rebar G-60 traded at PKR166,000-169,000/mt ex-works varying by brand amid stable demand. But end-users are waiting for the absorption of the price rise in the market.
Steel demand, except for graded rebar remained subdued. The Pakistani rupee further depreciated to around PKR164 mark against the US dollar, leading to high landed costs for imported materials and upward pressure on steel prices.
In absence of trades, domestic Bala billet dropped PKR1,000/mt to PKR136,000-136,500/mt ex-works, on Wednesday. Art Q toke scrap (equivalent to a mix of HMS and P&S) priced at PKR107,000-107,500/mt ex-yard Lahore.