Pakistani mills took a step back and chose to observe the global ferrous market as bulk prices fell over $25/mt in a recent deal in Turkey. Offers for Pakistani mills, however, remained firm but could drop $10-15/mt in the coming days.
The daily Davis Index for containerized shredded, Wednesday, dropped by $9.46/mt to $425.75/mt cfr Port Qasim. On Monday, prices had recovered with demand showing an uptick amid healthy rebar sales. But as the week progressed, prices started to lose steam.
Trades for EU and UK-origin shredded were in the range of $435-440/mt cfr Port Qasim early this week. But on Wednesday, mills stayed away from negotiations in the hopes of trades materializing in the range of $420-425/mt cfr Qasim in the coming days.
The daily index for US-origin HMS 1&2 (80:20) settled at $387.50/mt cfr Port Qasim, down $8.75/mt. There is a possibility of a drop in the US ferrous scrap prices in February as supply has started to ease with improved collection rates. Container availability is also better and many yards looked to make fresh offers.
Suppliers from the UAE offered #1 HMS and P&S at $395-400/mt cfr Port Qasim depending on quality. On Wednesday, the Davis Index for UAE-origin HMS 1&2 (80:20) settled at $386/mt cfr Port Qasim, down $2/mt from Monday as many sellers were under pressure to sell off piling inventories.
A few bids for HMS 1&2 (80:20) were at $375-380/mt cfr Port Qasim but most mills preferred other grades like shredded and busheling in Pakistan.
Domestic steel prices take a breather
Domestic Bala billet prices which were below PKR95,000/mt ex-works on Monday rose by PKR2,000-3,000/mt on Tuesday to PKR97,000-98,000/mt ex-works to remain unchanged on Wednesday.
Domestic Art Q toke scrap equivalent to a mix of HMS and P&S was offered at PKR78,500-79,000/mt ex-works Lahore, while Pure Q Toke (shredded) traded at PKR80,000-80,500/mt ex-yards. Limited supply and rising demand pushed domestic scrap up in Pakistan amid overall positive sentiment.
Deals for overseas scrap could pick up in the coming days. Rebar demand could reach its peak in the next two months as infrastructure projects in the country gather pace.
In Karachi, major rebar producers offered discounts on rebar to increase sales and stimulate cashflow. Trades for G-60 rebar were reported in the range PKR130,000-135,000/mt ex-works, while local rebar sold at PKR110,000/mt ex-works.