Pakistan: Imported scrap prices rebound to four-month highs on trade tensions

Imported scrap prices into Pakistan bounced back to four-month highs amidst the ongoing trade tensions between Russia and Ukraine. However, subdued finished steel demand kept imported scrap trade volumes under pressure.

“There are enquiries from customers in Pakistan but they seem to be assessing the  Russia-Ukraine issue and showing increased interest in the higher prices from Turkey”, said a prominent scrap trader.

Market players believe that to sell more volumes, sellers are sticking to firm offers at $570/t CFR levels for containerized. Shredded is expected to increase further, they add.

Recent offers & deals

• SteelMint’s assessment of UK-origin containerised shredded scrap stands at $565-570/t CFR Port Qasim, an increase of $10-15/t against the closing of last week. Most of the deals were concluded at $565/t CFR.
• In a confirmed deal concluded, around 3,000 t of UK/EU-origin shredded was sold at $565/t CFR Qasim basis. Another deal was concluded in which a major mill booked a decent quantity of UK-origin shredded at same levels.
• A deal was heard concluded for 1,000 t of shredded at $565/t CFR basis. However, the deal remained unconfirmed.
• Last week, around 6,000-7,000 t of UK/EU-origin shredded scrap in containers was booked at $550-555/t CFR Qasim recently.
• UAE-origin HMS 1 is currently being quoted at $540-545/t CFR levels.

Market movers

• Domestic rebar consumption remains slow: In contrast, Pakistan’s domestic rebar prices remained largely the same for yet another week as demand from end-users was still weak. Finished steel sales and inquiries have not improved at all. SteelMint’s assessment for domestic G-60 rebar stands at PKR 183,000-185,000/t exw-Punjab, including taxes, stable w-o-w.
• Local scrap prices down further: The sharp correction in locally sourced material had no impact on market activities, as slow consumption was observed from end-users, SteelMint learnt. SteelMint’s assessment for domestic purest scrap (equivalent to shredded) stands at PKR 115,000/t ($647/t) exy.

Pakistan domestic price

• PM’s relief package yet to impact steel industry:  In the latest announcement from Pakistan’s Prime Minister Imran Khan, power tariffs have been eased by PKR 5 per unit as part of relief measures for the public. However, this measure will have no impact on the steel industry because it targets domestic users. Hence, the steel industry waits for a relief package for commercial use, local sources highlighted.

Outlook: Traders said that most scrap yards are not willing to offer yet in anticipation that prices would rise further in the near future, SteelMint learnt.