Is depreciating Indian Rupee impacting Imported Scrap Offers?

Imported HMS 1&2 Scrap offers remain firm at USD 310-317/MT and Shredded at USD 335-340/MT, CIF India. While, Rupee has depreciated by 2.5% M-o-M.

Despite depreciating Indian currency, imported Scrap offers to India remain firm at USD 310-315/MT from European nations and USD 315-317/MT from Middle East countries.

Rupee has fallen to 63.22 against US dollar, recording a fall of INR 1.5 in a month’s time. This has now become a point of concern for Indian buyers as this is making Scrap imports more expensive. But, Scrap sellers are undaunted for their offers in India.

Offers from Europe & South Africa to the country were heard in the range of USD 310-315/MT for HMS 80:20 and USD 335-340/MT for Shredded Scrap, CIF Nhava Sheva.

A source from Singapore based Trading Company reported, “Recently, two deals of 500 MT European Scrap (HMS 1&2) were settled at USD 312/MT & USD 315/MT respectively. While, another deal of 1,000 MT Shredded was concluded at USD 338/MT, CIF Nhava Sheva.”

On the other hand, HMS 1&2 offers from Middle East were heard in the higher range of USD 315-320/MT and HMS 1 at around USD 330-335/MT, CIF Nhava Sheva.

While having a short conversation with a Middle East based exporter, he shared,“We have settled a deal of around 15 containers of HMS 1 at USD 331/MT, CIF India.”

Out of 15 containers, 5 containers will be unloaded at Mundra Port for Ludhiana and the rest will be shipped to Pipavav Port, he further added.

Though, deprecating Rupee is creating a nervousness in the market and resisting buyers to take position against expensive imports, tight supply of Scrap from Europe & Africa owing to freezing ports and Christmas holidays is providing complete support on sellers part.

As per Indian buyers, booking for Scrap is low at the moment owing to bulk bookings made at lower rates, early December. The shipment for those quantities are expected to arrive in January.

As an outlook, Scrap prices may continue to be at the same level. Presently, the only threat to Scrap is improving Iron ore condition in eastern region of India, which may put pressure on Sponge iron prices in near-term.

Imported Scrap Offers as on 22 Dec, 2014