Imported Scrap offers fall to USD 365-370/MT CFR India

Amid depressed domestic steel market and international price pressure from China, Scrap offers soften by USD 5/MT this week.

HMS Scrap offers from Middle East have corrected by USD 5/MT settling at USD 365-370/MT CFR Nhava Sheva. Competitive Billet offers from China have build pressure on the global market, as importing nations have started preferring imports of cheaper Billet over dearer Scrap.

Trade experts believe that Turkey, which is a major exporter of finished products, is making efforts to reduce its conversion cost, in order to battle with cheaper Chinese Billet prices. This has also led to depreciation in purchase prices of Scrap in Turkey to USD 365-370/MT CFR Turkey.

Offers for HMS 1&2 from Europe & South Africa have also declined to the tune of USD 4-5/MT. Currently, European offers are at around USD 370/MT and from South Africa, it is at USD365/MT  CFR India. Few deals were even heard at these levels from South Africa.

Back here in the domestic market, Mill owners explain market to remain depressed for another one month till the end of Diwali. On the contrary, traders & importers of Scrap are positive about the revival of market narrating end of monsoon.

Offers for HMS-1 from West & Central Africa are at around USD 365/MT. Whereas, for HMS 1&2, it is at USD 355-360/MT CFR Nhava Sheva. Similarly, market in Chennai remains dull with offers being unchanged. Europe is offering HMS still at USD 375-380/MT, but buying interest is seen at around USD 365/MT. Whereas, offers from South Africa are at around USD 370/MT and buying interest is at USD 360/MT CFR Chennai.

Billet/Slabs/Blooms imported from China and South East Asian countries at a competitive price is creating problems for Scrap importer as mills here are either running under capacity or they are preferring imported Billet over Scrap.

Market participants believe that slump in Iron ore prices to 5 years low is also one of the major reasons for lower steel prices.