Pakistani steel mills continued to look for offers actively for their melt requirements. Hopes of a spur in demand after Eid kept steelmakers in the market. The tightened restrictions to control the spread of the COVID-19 virus has a limited bearing on production and transportation activities. Suppliers are bullish and raised offers by another $7-10/mt from a day ago.
Pakistani currency depreciated to PKR155.11 against $1 on Tuesday from 153.11 on Monday. There is a possibility that the depreciation could impact overseas trade in the coming days.
The daily Davis Index for containerized shredded, Tuesday, settled at $463.88/mt cfr Port Qasim, up by $3.02/mt. Sellers kept offers at $470/mt cfr Qasim on Tuesday, but mills were unwilling to bid above $460-462/mt cfr. Amid limited inventories and the non-availability of material at earlier offer levels, a rise seems inevitable.
In Turkey, offers rose to take the daily index to $433.13/mt cfr, up $6.69/mt for bulk US-origin HMS 1&2 (80:20), despite Ramadan lull. Sellers are bullish on hopes of demand picking up in May.
The daily index for US-origin HMS 1&2 (80:20), Tuesday, gained $1.25/mt to $442.5/mt cfr Port Qasim. Offers were at $445-450/mt cfr Qasim depending on quality for containerized HMS. Freight rates on the US route declined slightly, but the non-availability of containers continued to impact trade. Most mills were inclined to purchase UAE-origin HMS since it has a shorter transit period. The demand for UAE HMS from India remains affected due to the COVID-19 resurgence.
The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $445/mt cfr Port Qasim, up by $2/mt from Friday. Offers for mixed #1 HMS and P&S from UAE rose by $5/mt from Friday to $455-460/mt cfr Port Qasim, depending on quality. Limited operation and transportation hours, along with annual maintenance activities and increased power consumption has impacted supplies from the UAE. Rebar prices in UAE also remain firm.
Steel prices continue gradual uptrend
In the domestic market, Bala billet was offered at PKR110,000/mt ex-works Lahore, up by PKR500/mt from Monday. Offers for G-60 billet rose by PKR1000/mt to PKR114,500-115,000/mt ex-works Punjab from Friday.
Long steel producers in Punjab and Karachi turned optimistic about the price rally.
Chinese steel prices scaled up further on Tuesday, supporting firm offers by Pakistani sellers. Local rebar offers remained elevated amid a ramp-up in construction activities.
Offers for rebar remained above PKR135,000-136,000/mt, ex-works Karachi, while in Punjab, it traded at around PKR131,000-132,000/mt ex-works. Local rebar sold at PKR120,000-121,000/mt ex-works Punjab. With improvement in demand, most steelmakers are likely to attempt another round of price hike in the coming days.
Domestic scrap rises
Driven by a rise in imported scrap offers, domestic scrap Art Q toke equivalent to a mix of HMS and P&S, Tuesday, traded at PKR90,000-90,200/mt ex-yard Lahore, up PKR200-300/mt. Deals for Pure Q toke scrap equivalent to shredded were at PKR91,000-91,200/mt ex-yard Lahore, up PKR300-400/mt from a day prior.