Middle East Scrap Suppliers curtail offers amid depreciating Indian Rupee

After a week of stable Scrap offers, Middle East based Scrap suppliers have finally reduced it to USD 5/MT.

Despite lower Scrap prices offered from Europe and US, Middle East exporters had unaltered their offers since last week. However, the current offers for HMS 1&2 are hovering in the range of USD 355-356/MT CIF Mumbai, which was around USD 360/MT last week, confirmed by the trade sources. An exporter reported to sold 500 MT HMS 1&2 at USD 356/MT CIF Nhava Sheva to a Mumbai based induction furnace.

On the other hand, offers for HMS 1&2 from Europe are around USD 5/MT lesser than Middle East offers. Currently, it is being offered at USD 350/MT CIF Nhava Sheva (Mumbai). While, induction furnaces in India still prefer Scrap from Middle East because of its quick delivery and zero freight (in special conditions).

Sources confirmed that falling INR against USD has made suppliers to reduce their offers. Currently, it is hitting 7-month low at 61.85/USD. Indian currency has been depreciated on the background of widened India’s trade deficit by USD 3.41 billion (M-o-M) to USD 14.25 billion in September because of increase in oil & gold imports, as per the data release by the government on 14 Oct, 2014.

India, the 3^rd largest Scrap importer, has imported over 23% of its total Scrap imports from Middle East in H1 FY15.