Pakistan’s domestic rebar prices have not seen any sharp changes this week as government construction projects remained slow keeping inquiries from end-users subdued. SteelMint’s assessment for domestic G-60 rebar stands at PKR 186,000-187,000/t exw-Punjab ($1,064-1,070/t), including taxes.
Reasons for subdued long steel demand
- Rising steel inventories with mills: With consumption from end-users being slow, rebar inventory with the mills have increased. Meanwhile, mills are holding back from placing new orders for imported scrap as they await an improvement in finished steel sales.
- Mills cut production:Most mills are looking to cut their rebar production as inventories are piling up. “A few mills are planning to reduce their production as sales are not picking up,” said a local steel producer.
- Liquidity issues: The steel market turned dull due to liquidity issues. However, the month of February is traditionally slow in terms of steel consumption. After March, construction activities are likely to improve which may increase steel consumption.
Pakistan domestic prices
Imported scrap offers up, limited trade heard
Imported scrap offers have moved up significantly by $15-20/t w-o-w with a few major mills being aggressive in booking fresh slots at favourable prices. Offers for UK/Europe-origin shredded scrap in containers stands at $565-570/t CFR.
- In a recent deal, around 2,000 tonnes of UK-origin shredded have been booked at $555-560/t CFR Qasim basis.
- Around 10,000 t of UK/EU-origin shredded scrap in containers were booked at $555/t CFR Qasim last weekend.
- UAE-origin HMS 1 is being offered at $530/t CFR Qasim, up by $5/t w-o-w. It has been heard that freight rates from Dubai are likely to see an increase which may lift offers further.
Outlook
Mid-sized mills are waiting for clarity in the domestic market. It seems, mills may return for imported scrap bookings later this week and accept the price hike, as suppliers see fewer chances of a downward correction.
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