Imported ferrous scrap offers to South Asian markets maintained an upward trend with expectations of demand recovery in the coming days. End-user demand in Bangladesh and Pakistan has been recovering gradually. Following global cues, offers jumped by $5/mt in a day with the most suppliers now expecting to offer fresh levels in the next couple of days. Trades were slow amid limited offers in the market.
The prices in Pakistan and Bangladesh rose to an 8-month high following a bullish trend in Turkish bulk scrap prices. Availability with Pakistan mills remained limited while Bangladesh mills expect domestic markets to turn supportive this week.
Weak domestic steel demand and lack of support from buyers slowed ferrous scrap trade in Pakistan. Pakistani buyers are expected to book containers this week only if demand from downstream sectors return.
The Davis Index for containerized shredded settled at $322/mt cfr Port Qasim, up $2/mt from Friday. Despite a jump in Turkish bulk imported scrap prices by $5/mt in a day, Pakistani mills showed resistance in accepting these levels. Offers for shredded reported at $322-325/mt cfr Port Qasim, lagging behind by $5/mt to Indian offers. Pakistan buyers on Monday were unwilling to accept $320/mt cfr Qasim for shredded, according to Davis Index sources.
The Davis Index for UAE-origin HMS 1&2 (80:20) Monday settled at $307.86/mt cfr Port Qasim, up $1.86/mt from Friday. Trades for UAE-origin mixed #1 HMS and P&S sarya scrap were at $310/mt cfr Port Qasim. The index for US-origin HMS 1&2 (80:20) settled at $307/mt cfr Port Qasim, up $1/mt from Thursday in absence of trades. Gadani’s shipbreaking market turned silent again this week and trades remained slow amid cash crunch.
In the domestic market, Bala billet prices were at PKR91,000/mt ex-works Punjab with limited trades being reported.
High prices of imported scrap pushed domestic Pure Q toke scrap equivalent to shredded traded at PKR70,300-70,500/mt ex-works Lahore on Monday, up by PKR300/mt from early this week. Mills struggling with limited cash flows and weak steel demand did not find it feasible to pay such high prices. However, a sharp jump in prices left them with no option but to book material at these prices.
Bangladesh’s domestic steel market showed signs of revival as domestic steel prices rose BDT300-500/mt in line with rising demand. Ferrous scrap importers rose inquiries further on Monday. Most infrastructure projects have resumed, and demand is expected to return to normalcy after mid-September, with mills turning 100pc operational.
Imported bulk scrap offers were in the range of $325-330/mt cfr Chattogram on Monday.
The Davis Index for containerized shredded settled at $329/mt cfr Chattogram, up $2/mt from Friday. Trades reported at $328-330/mt cfr Chattogram for UK-origin material while offers for EU and Australia-origin were around $315-325/mt cfr Chattogram. Trades are expected to gain further in Bangladesh on improving domestic fundamentals.
Trades for containerised South African P&S scrap were at $325-328/mt cfr Chattogram flat from the prior week. The index for Latin America-origin HMS 1&2 (80:20) settled at $309.43/mt cfr Chattogram, up by $1.68/mt from Friday. A few containers traded at $308-310/mt cfr Chattogram, while #1 HMS from South Africa and South America origin were traded at $317-320/mt cfr Chattogram.
The index for US-origin HMS 1&2 (80:20) was at $316/mt cfr Chattogram, up by $1/mt from Friday. Sellers offered HMS 1&2 (80:20) at $317-320/mt cfr Chattogram, while buyers booked the grade at $312/mt cfr Chattogram.
A leading steelmaker in Chattogram, GPH, offered rebar at BDT49,000/mt ex-mill Chattogram. Restocking activity for ferrous scrap before resuming operations at their newly installed electric arc furnace supported the mill to book more ferrous scrap. The steelmaker had postponed commencement at this site due to COVID-19 pandemic impact on demand.
Small scale rebar was offering billet at BDT49,000-50,000/mt ex-works. Large steel producers offered rebar at BDT56,000-57,000/mt ex-works, while a few offered discounts of BDT1,000/mt and sold them at BDT55,000/mt ex-works. Domestic shipbreaking scrap equivalent to P&S was traded at BDT30,500/mt ($359.6/mt) delivered mill on Monday while HMS 1&2 (80:20) was at BDT29,000/mt ex Chattogram.
($1= PKR165.65; BDT84.81)