The South Asian ferrous scrap offers have experienced a slight uptick d-o-d despite weak buying interest. In India, the imported scrap market remained sluggish today, marked by bid-offer disparities. Meanwhile, in Pakistan, market activity was subdued amidst anticipation of tomorrow’s federal budget announcement and a lack of buying interest on approaching of Eid and related preparations. In Bangladesh, moderate interest in imported scrap was noted, reflecting uncertainties surrounding price trends and the recent budget’s impact.
Overview
India: India’s imported scrap market remained slow today due to bid-offer disparities. Shredded scrap offers from the US and UK/Europe were $420-425/t CFR Nhava Sheva, but buyers were unwilling to meet these prices, leading to no sales. Meanwhile, HMS (80:20) offers were assessed at $395-400/t CFR levels.
Market insiders noted that the market has seen a significant drop in imported volumes in the first quarter but is expected to rebound with rising steel demand from new projects, including 3 crore housing units and new railway projects. Infrastructure development in T2 and T3 cities also supports a positive steel demand outlook. However, new bulk vessel bookings are limited as metallics like sponge iron are preferred due to more favourable pricing.
As per a trading house representative, “Freight rates have doubled from $25-30/t to $55-60/t, slowing container bookings unless suppliers keep pricing viable. Shredded scrap prices have risen by over $25/t due to higher freight costs, potentially reaching $430/t. The voyage period has doubled due to sea route disruptions, from 28-30 days to 55-60 days. Consequently, current pricing disparities and logistical challenges have stalled buying activities, with a $5-6 gap in bid-offer prices.”
Pakistan: Pakistan’s imported scrap market was slow today due to several factors. Firstly, with Eid approaching over the weekend, market activity typically slows down as businesses prepare for the holiday. Additionally, anticipation surrounding the announcement of the federal budget tomorrow contributed to cautious sentiment, as market participants awaited potential policy changes. Notably, the recent decision to slash the discount interest rate after four years was viewed positively, but its impact is expected to be gradual, with further reductions anticipated in the next 12 months.
A trader reported, “The market remained silent with no fresh offers reported. Limited activity was observed, with some purchases made at previous prices.”
Offers for shredded scrap from the UK/Europe were assessed at $425-430/t CFR Qasim.
Bangladesh: Bangladeshi buyers showed moderate interest in imported scrap today due to unclear price trends and the recent budget’s impact. UK/US-origin shredded scrap was priced at $425-430/t CFR Chattogram, while HMS (80:20) was at $405-410/t CFR. Australia-origin PNS was priced at $440/t CFR, and HMS 1 from Australia was heard at $415/t CFR.
Economists criticised the recent budget for lacking strategic direction and key reforms for the steel sector. The budget left the duty structure unchanged and focused on education, health, agriculture, local government, rural development, power, communication, and science and technology. It neglected critical issues such as export competitiveness and renewable energy, essential for long-term growth. The absence of significant reforms in the energy, banking, and port sectors raised concerns about economic stability. Without measures to address high inflation, stabilise foreign debt, and boost private investment, maintaining economic growth and creating employment may be challenging.
Turkiye: Turkish deepsea imported ferrous scrap prices remained steady. European recyclers targeted $380/t CFR despite the euro’s sharp depreciation. Offers for EU-origin HMS (80:20) values were around $380/t CFR, and US-origin HMS (80:20) ranged from $382-384/t CFR. The euro’s depreciation followed a snap poll in France. EU recyclers suggested Turkish mills might attempt to lower prices but were unlikely to succeed. A weaker euro could allow recyclers to pay more for HMS at the docks, with collection costs possibly reaching Euro 320/t. However, this was not confirmed by other recyclers. Market activity was limited amid a slow start to the week.
Price assessments
India: UK-origin shredded scrap indicatives were assessed increased by $2/t d-o-d to $422/t CFR Nhava Sheva.
Pakistan: UK-origin shredded indicatives were assessed at $425/t CFR Qasim, up by $2/t d-o-d.
Bangladesh: UK-origin shredded prices edged up by $3/t to $425/t CFR Chattogram.
Turkiye: US-origin HMS (80:20) bulk prices were assessed unchanged at $384/t CFR Turkiye, d-o-d.
