India: Scrap import market dull as mills prefer domestic substitutes

India’s scrap import market remained dull throughout the week as weak demand was observed from end users, with preference tilting toward domestic substitutes – sponge iron and domestically generated scrap material. Also, the ongoing Ganesh Chaturthi festival has kept trade subdued, whereas scrap buyers are less active in booking fresh slots.

On the other hand, container shortage globally is keeping Indian importers sceptical about material deliveries. While demand for scrap in India exists, there is discrepancy in bids and offers that has kept trading subdued. Buyers continue to go for domestic substitutes, SteelMint learnt from market sources.

Apart from the Indian market, global scrap prices are at high levels. Even global suppliers like to trade mostly in Pakistan and Bangladesh and make a fast buck.

Recent offers in containers for Indian market

• Fresh offers for UK/EU-origin shredded material are at $525/t CFR Nhava Sheva, stable against last week. No firm bookings have been made on these offers.
• Dubai-origin HMS 1 offers were heard at around $480/t CFR Nhava Sheva, down $5/t CFR, w-o-w.
• HMS 1&2 (80:20) material from the UAE is being offered at $470/t CFR Nhava Sheva, down $5/t CFR, w-o-w.

Domestic scrap prices vary across markets: Melting scrap prices saw irregular movements across markets, mainly due to offer-bid disparity. Prices remained supported on tight material availability and improved demand in semi-finished steel. Traders are adopting a cautious attitude due to frequent fluctuations in steel prices and are waiting for clearer market trends to emerge, SteelMint learnt from sources.

SteelMint’s assessment for HMS was recorded at INR 34,700/t DAP Mumbai, up INR 200/t, w-o-w, while prices for Jalna are at INR 34,800/t DAP, down INR 400/t, w-o-w.

India’s IF re-bar prices fall further: Induction furnace re-bar prices declined across regions. A sharp decline in prices in the western region was observed. Overall finished long steel transactions were not adequate enough to support prices except in the short term. As per SteelMint’s assessment, induction furnace (IF, Fe 500) re-bar prices in Mumbai stand at INR 45,700/t exw, down INR 1,900/t exw on a weekly basis.