Pakistani mills resumed inquiries for imported ferrous scrap on Monday after Eid celebrations, but trades were slow as buyers awaited clarity on global cues.
Expectations of a recovery in Turkish bulk demand boosted buying appetite in Pakistan. Offers were firm as steel prices remained on an uptrend with a recovery in demand. However, rising COVID-19 cases impacted transportation and economic activities in Sindh, while rains in Karachi kept domestic recovery slower than expected.
The depreciation of Pakistani currency is likely to push domestic steel prices higher than those before Eid closures. Pakistani rupee traded at PKR160.06 against the US dollar on Monday.
The daily Davis Index for containerized shredded, Monday, rose by $0.75/mt to settle at $545/mt cfr Port Qasim. Most offers Monday were at $545-550/mt cfr Qasim after a few trades for shredded heard at $545/mt cfr Qasim post-Eid holidays. Many traders, however, kept asking prices at $550/mt cfr Qasim.
Pakistan would be the most preferred market this week with India recovering slowly, while Bangladesh is expected to be in the third position in the subcontinent.
There will be an extension of the temporary suspension of exports of steel scrap and wastepaper from the UAE for another five months till December 14, 2021, according to industry sources. A few sellers in the UAE are gradually returning to the market and are accessing the impact of this news on actual trades.
The daily Davis Index for UAE-origin HMS 1&2 (80:20) rose to $501/mt cfr port Qasim, up $1/mt. Expectations for UAE-origin mixed #1 HMS and P&S unchanged at $510-515/mt cfr Port Qasim. The daily index for US-origin HMS 1&2 (80:20), Friday, settled at $502.5/mt cfr Port Qasim also unchanged from Friday.
Resumption in construction projects are expected to keep rebar and billet prices elevated. Tight supply and a sharp rise in ship breaking costs pushed Art Q toke scrap (equivalent to a mix of HMS and P&S) above PKR100,500/mt ex-yard Lahore and Pure Q toke scrap (equivalent to shredded) above PKR102,500/mt ex-yard Lahore.
For ship recyclers, offers of scrapped vessels at $580-590/ldt cnf Qasim amid improvement in buying sentiment.