- Market sources expect a further $5-10/t increase if UAE supply disruptions persist
- Domestic scrap prices remain stable amid low mill utilisation
Pakistan’s imported scrap market strengthened in the week ending 19 October following a vessel sinking that disrupted scrap supply from the UAE. UK/EU-origin shredded scrap rose to $420-422/t CFR Qasim from $409-412/t last week as buyers sought replacement cargoes and sellers adopted firmer pricing positions.
The disruption has raised concerns over the availability of Middle-East origin material in Pakistan and prompted some buyers to consider alternative supply sources.
Market sources reported that importers booked more than 20,000 tonnes of replacement scrap from the UK and Europe within three days.
BigMint assessed Europe-origin shredded scrap at $417/t CFR Qasim, increased by $5/t w-o-w.
Market scenario
A Karachi-based steelmaker said, “There were many offers in the market three days before this incident. Since 13 October, most have been sold, and sellers are now showing a firmer attitude. Demand from the UK and Europe will rise now, and we are expecting market prices to jump by $5-10/t in the coming days.”
A Peshawar-based mill source also reported UK/EU shredded scrap offers at around $415/t, compared with $409-412/t last week. Buyers are expected to seek more UK/EU cargoes to compensate for disrupted UAE supply.
A UK-based supplier said, “Loaded-yard shredded scrap offers have strengthened sharply amid concerns over disrupted UAE shipments. UK-origin material was offered at $430/t CFR Qasim for 800 t, with an ETA of 24 October, while Australian-origin scrap was offered at $427/t for 800 t, with an ETA of 21 November. Another UK-origin cargo of 1,000 t was offered at $422-424/t CFR Qasim, with an ETA of 24 November.”
Domestic scrap and steel prices remain stable
Pakistan’s domestic scrap prices in Punjab remained largely stable week on week at PKR 131,000-133,000/t ($473-481/t), based on an exchange rate of PKR 276.66 per US dollar. Imported shredded scrap was priced at $418-422/t, while domestic billet stood at PKR 210,000-212,000/t ($759-766/t) and rebar at PKR 231,000-233,000/t ($835-842/t). Steel mill utilisation was estimated at around 30%, with sales levels at 30-35% with subdued downstream demand and limited operating activity.
Outlook
UK/EU-origin shredded scrap prices in Pakistan are likely to remain firm as importers seek replacement cargoes amid UAE shipment disruptions. Limited prompt availability and stronger seller negotiating positions could push offers higher, with market sources anticipating a further $5-10/t increase. However, the extent of the rise will depend on the duration of the disruption, the pace of replacement bookings, and whether higher import costs are absorbed by domestic mills amid low utilisation and subdued steel sales.
Leave a Reply