Imported ferrous scrap prices in South Asia remained flat on Wednesday. Buyers are in a wait-and-watch mode as they seek clarity in the market direction.
With COVID-19 cases still refusing to subside in India, steelmaking activity remains hit. Pakistani and Bangladeshi mills, on the other hand, have their eyes set the upcoming budget announcement this week before opting for trades actively.
Indian mills continued to face a labour shortage which has limited their steelmaking ability. But if melting activity hits its usual level by the end of July, traders believe the country could face a shortage of ferrous scrap. Thus, to avoid running out of inventories, mills are likely to be in the market for scrap in the coming days. A few mills were in a hurry restock amid weak domestic supply.
The Davis Index for containerised shredded settled at $285/mt cfr Nhava Sheva, unchanged from Tuesday. Sellers from the UK and Europe held offers in the range $285-290/mt cfr Nhava Sheva, but no buyers were keen to buy shredded containers.
Trades for HMS scrap also slowed down this week following weakened domestic finished steel and semi-finished prices. The Davis Index for UAE-origin containerised HMS 1&2 (80:20) settled at $270/mt cfr Nhava Sheva, unchanged from Tuesday. The index for US-origin HMS 1&2 (80:20) was at $270/mt cfr Nhava Sheva, unchanged from Tuesday.
Offers for HMS 1&2 (80:20) were at $270-280/mt cfr Nhava Sheva, depending on origins, but bids lagged at $255-265/mt cfr Nhava Sheva. Traders had raised their bids by $5/mt this week. Brazilian HMS 1&2 (80:20) was offered at $270-275/mt cfr Nhava Sheva and Mundra.
Domestic steel demand in Pakistan shows signs of recovery and billets increased by PKR3,000-4,000/mt from the prior week. Participants are awaiting the budget outcome and thus stayed away from ferrous scrap bookings. A rise in scrap import prices in Turkey’s market is likely to reflect in the offers for Pakistani buyers.
The daily Davis Index for US-origin containerized shredded settled at $292/mt cfr Port Qasim, up by $1/mt. Trades for US-origin shredded were flat at $285-290/mt cfr Port Qasim. Suppliers from the UK and Europe, however, raised offers to $295/mt cfr Port Qasim, with very limited buyers at those levels.
The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $272/mt cfr Qasim, up by $2/mt from Tuesday. A few UAE sells are selling material despite an export ban announced by the country’s government.
The index for US-origin HMS 1&2 (80:20) was at $275/mt cfr Qasim, unchanged from the prior week. Offers were at $275-280/mt cfr Qasim.
Bangladesh steel mills remained silent as they hold enough inventories of ferrous scrap in hand. Major mills are still operating at 40-50pc capacity and downstream demand remained subdued.
The daily Davis Index for containerised shredded settled at $300/mt cfr Chattogram, down by $1/mt. Offers for shredded were flat and in the range of $305-310/mt. Bids in the market were below $295/mt cfr Chattogram.
The index for Latin America-origin HMS 1&2 (80:20) settled flat at $275/mt cfr Chattogram. Offers for Brazilian scrap were at $280/mt cfr Chattogram.
The index for US-origin HMS 1&2 (80:20) settled at $285/mt cfr Chattogram, unchanged from Tuesday.
Imported ferrous scrap prices in Taiwan were flat on Tuesday with the index for US-origin HMS 1&2 (80:20) settling at $244/mt cfr Taiwan. Offers for US-origin HMS 1&2 (80:20) were at $250/mt cfr Taiwan. But trades heard at $245/mt cfr Taiwan. A rise in offers was driven by an increase in Turkish ferrous scrap import buying. Though, weak finished steel demand kept trades low.
Offers for Australian-origin HMS 1&2 (80:20) were at $245/mt cfr Taiwan. As per Taiwan’s Customs data, Japan was the largest ferrous scrap exporter to Taiwan in May and exported 138,519mt.
Effective June 11, Japanese Tokyo steel raised domestic ferrous scrap prices by JPY1000/mt at four of its works. HMS 1&2 (50:50) was offered at $275/mt cfr Taiwan in small bulk vessals, up by $10/mt from Tuesday.